When you use a mortgage to purchase a home, the lending institution effectively owns the home. You buy back part ownership in the home with each monthly payment. The part you have bought back is your...

When you use a mortgage to purchase a home, the lending institution effectively owns the home. You buy back part ownership in the home with each monthly payment. The part you have bought back is yourequity in the home. If the mortgage amount isP dollars, the monthly interest rate isr as a decimal, and the term of the mortgage ist months, then your equity afterk payments is

dollars.

In this exercise, assume that the mortgage amount is $150,000, the APR is 6%

and the term of the loan is 30 years (360 months).