Homework Help: Math

Posted by Grace on Thursday, November 29, 2007 at 6:28am.

please check my answer thanks :)

Juan bought a home with an adjustable-rate mortgage. The margin on the loan is 2.7% and the rate cap is 7.2% over the life of the loan. If the current index rate is 4.3%, what isthe initial rate of the ARM ?

A. 7%
B 9.9%
C 14.32%
My answer is I said A

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