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    The APR for a 30 year, $250,000 mortgage at 6% interest compounded monthly and two discount points is:

    A. 6.25%
    b. 6.19%
    c. 6.12%
    d. 5.87%
    e. None of the above.

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    Solution Preview

    Your answer is 6.19%.

    Also, here is some information about the APR to help you understand it a little better.

    What is an Annual Percentage Rate (APR)?
    The annual percentage rate (APR) is an interest rate that is different from the note rate. It is commonly used to compare loan programs from different lenders. The Federal Truth in Lending law requires mortgage companies to disclose the APR when they advertise a rate. ...

    Solution Summary

    The solution determines a question based on probability, statistics and finance.