# UCLA ECON 103 - Midterm Practice Questions Fall 2014 (3 pages)

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## Midterm Practice Questions Fall 2014

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- Pages:
- 3
- School:
- University of California, Los Angeles
- Course:
- Econ 103 - Introduction to Econometrics

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Midterm Practice Questions Fall 2014 1 An adjustable rate mortgage with a teaser start rate of 1 5 an index of six month LIBOR a margin of 2 0 and periodic and lifetime caps of 2 6 with semi annual adjustments would have a maximum interest rate of what at the beginning of the fourth loan year if six month LIBOR is 4 5 at that time a 5 5 b 6 5 c 7 5 d 8 5 2 An adjustable rate mortgage with a teaser start rate of 1 5 an index of six month LIBOR a margin of 2 0 and periodic and lifetime caps of 2 6 with semi annual adjustments would have a maximum interest rate of what at the beginning of the fourth loan year if six month LIBOR is 6 5 at that time a 5 5 b 6 5 c 7 5 d 8 5 3 An adjustable rate mortgage with a teaser start rate of 1 5 an index of six month LIBOR a margin of 2 0 and periodic and lifetime caps of 2 6 with semi annual adjustments would have a maximum interest rate of what at the beginning of the second loan year if six month LIBOR is 6 5 at that time a 5 5 b 6 5 c 7 5 d 8 5 4 If the loan to value ratio is 75 the stated annual interest rate is 6 the loan term is 30 years fully amortized and the down payment is 400 000 what is the purchase price of the property a 400 000 b 1 200 000 c 1 600 000 d 2 000 000 5 Referring to the prior question what is the monthly payment on the loan a 1 798 65 b 2 398 20 c 7 194 61 d 9 592 81 6 What is the APR on a 30 year fully amortized fixed rate loan in the amount of 1 000 000 if the stated annual interest rate is 4 5 and the lender charges 1 point as an origination fee 180 for a credit report and 360 for an appraisal a 4 68 b 4 59 c 4 50 d 4 41 7 If a lender wants to achieve an APR of approximately 4 on a 30 year fixed rate loan for 750 000 with a stated annual interest rate of 4 0 and no other fees or costs to the borrower how many points should the lender charge the borrower a 1 b 2 c 3 d 4 8 An investor is considering a commercial property acquisition at a price of 10 000 000 with the following annualized financial

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