Unit 9: Instructor Graded Assignment – Version 3 Calculating Mortgages and Taxes Unit 9 focuses on mortgages and taxes, which are covered in your reading of Chapter 16: “Mortgages” and Chapter 20: “Taxes.” You must show your work at all times. The steps for solving each problem must be explained. Failure to do so could result in your submission being given a 0 grade. If you have any questions about how much work to show, please contact your instructor. Assignments must be submitted as a Microsoft® Word® document and uploaded to the Dropbox for Unit 9. Type all answers directly in this Assignment below each question. All Assignments are due by Tuesday at 11:59 p.m. ET of the assigned unit. Available Resources One of the benefits of attending here at Kaplan is that we have a tremendous amount of resources available for you. If you find yourself having difficulties completing this exercise consider taking advantage on one or more of the following resources: 1. Textbook: The textbook reading assigned for each unit includes the topics and calculation details for each type of problems you will complete. 2. LiveBinders: In the LiveBinder for the unit, you will find more information on unit topics, example problems, and video content on the unit’s topics. To access the LiveBinder for a unit, use the menu on the left side of the classroom, select the unit you are in, and when you click the unit link several additional links will appear below the unit heading, one of those links will be “Live Binders.” 3. KU Math Center: Take advantage of the KU Math Center’s many services: a. Math Tutoring b. Question & Answer Services c. Request a Video Example Services d. Project Review Services (be sure to submit Assignments early enough to receive feedback and make corrections before the Assignment due date (24 hour turn-around times Monday-Thursday and 48 hour turn-around times on weekends are typical). e. Math Center Reference Library To access the KU Math Center start at the KU Campus Home Page. From the KU Campus Home Page, select My Studies (top menu bar), then select Academic Support Center, and review the Math Center offerings. 4. Email Your Instructor: Your instructor is only an email away; when you cannot make any more progress on a problem, reach out. Send your instructor the work you started and steps of the problem you have completed so far, and ask for help. Your instructor will respond within 24 hours. Mortgages and Taxes Assignment (Total 40 Points) Question 1: (20 Points) a) You are purchasing a business building valued at $245,000. You can find a mortgage at 5.5% if you can put 20% down. You believe your business can support a $1,200 a month mortgage payment (not including taxes and insurance). Should you select a 25 year mortgage or a 30 year mortgage? Tell your reasons. b) If your yearly taxes for the building will be $2,400 and the insurance for the building will be $1,650 per year, what will the total of the PITI for the mortgage be? c) Compute what the unpaid principal balance will be after you’ve made three payments on the mortgage. d) What will the new annual taxes on the property be if the assessed valuation is 60% of purchase price and the new tax rate is 1.95 per $100 of assessed valuation? Question 2: (10 Points) a) Aonte Canyon, Arizona (a fictitious city) has a new budget of $89,695,000 to pay for police, fire, schools, and government, among other expenses. The total assessed valuation (based on 60% of market value) in the city is $7,799,023,000. Find the tax rate per $1,000 of assessed valuation b) Now find the taxes on a property that has an assessed valuation of $180,500. Question 3: (5 Points) a) Find the sales tax of a new above ground pool that you pay $13,500 for if the tax rate in your area is 8.9%. b) Find the marked price and tax for an $9 beer at the local football stadium, where the sales tax rate is 9.35%. Question 4: (5 Points) Research the excise tax for gasoline in the state in which you live. For example, a state may have excise taxes of between $0.283 cents per gallon to $0.363 cents per gallon, depending on the county you purchase your gas in. If the current price for a gallon of gas is $2.76, what percentage of each gallon of gas is the excise tax?