Question

an individual borrowed ​$65,000 at an APR of 3​%, which will be paid off with monthly payments of ​$348 for 21 years. Identify the amount​ borrowed, the annual interest​ rate, the number of payments per​ year, the loan​ term, and the payment amount.

Answer 1

Amount borrowed = $ 65,000,

Annual interest rate = 3%,

Number of payments per year = 12,

Loan term = 21 years,

Payment amount = $ 348

Explanation:

Since, the amount of the loan is called amount borrowed,

Here, Amount borrowed = $ 65,000,

Also, APR = Annual percentage interest,

So, Annual interest rate = 3%,

∵ Loan has monthly payments of ​$ 348,

⇒ Monthly payment = $ 348,

Number of payments per year = 12, ( 1 year = 12 months ),

Now, loan is for 21 years,

⇒ Loan term = 21 years,