This requires the mortgage formula for the monthly payment, as follows:
Monthly Payment Amount
= [tex]P(i(1+i)^n)/((1+i)^n-1)[/tex]
where
P=present value (borrowed amount) = 30000
i=interest per period = 0.12/12 = 0.01 per month
n=number of periods (months) = 25*12 = 300 months
Evaluating,
Monthly payment
=P*(i*(1+i)^n)/((1+i)^n-1)
=30000*(0.01*(1+0.01)^300)/((1+0.01)^300-1)
=315.97
