Jerry bought a house for $400,000 and made an $80,000 down payment. He obtained a 30-year load for the remaining amount. Payments were made monthly. The nominal annual interest rate was 6%. After 10 y

a) Jerry's monthly loan payment can be calculated using the PMT function in Excel. The formula is =PMT(rate/12, n, -pv) where rate is the nominal annual interest rate, n is the total number of payments (30 years x 12 months = 360), and pv is the present value (remaining loan amount after down payment). Using the given information, we have: rate = 6% n = 360 months pv = $320,000 ($400,000 - $80,000) Plugging these values into the formula, we get: =PMT(6%/12, 360, -320000) =$1,917.54 Therefore, Jerry's monthly loan payment was $1,917.54. b) In order to calculate the additional payment Jerry must make to pay off the loan, we can use the PV function in Excel. The formula is =PV(rate/12, n, pmt, [fv], [type]) where rate, n, and pmt are the same as before. Fv is the future value of the loan balance (which should be zero at the end of 120 payments) and type can be left blank or set to 0. Using the same values as before and assuming a future value of zero, we get: =PV(6%/12, 240, 1917.54, 0) =$228,861.38 Therefore, Jerry must pay an additional $228,861.38 (in addition to his regular 120th monthly payment) to pay off the loan after 10 years.