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The figure below shows costs for a current home mortgage versus a refinanced home mortgage. Refinancing has initial costs, but results in a lower monthly payment. Which best describes the lines?

The figure below shows costs for a current home mortgage versus a refinanced home mortgage Refinancing has initial costs but results in a lower monthly payment class=
The figure below shows costs for a current home mortgage versus a refinanced home mortgage Refinancing has initial costs but results in a lower monthly payment class=

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Answer:

D

Step-by-step explanation:

The correct statement is A. The red line represents financing which is cheaper after 6 months.

How to know which options best describes the lines ?

  • We know that refinancing has initial costs.
  • So the total cost in the beginning cannot be zero.

From these we can conclude a lowest monthly payment means the line

has a lowest slope.

  • Observing the graph again we can see that the red line is above the blue line for the first 6 months and below it for the next 6 months.

So, option A is correct.

Find more about "Refinancing" here: https://brainly.com/question/25843537

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