Question

The total of monthly payments for a three-year loan is $22,317.12. The APR is 4%. How much money was originally borrowed?

Answer 1

$717336

Explanation:

The total of monthly payments for a 3-year loan is $22317.12.

So, the total amount has to pay back in 3 years is $(22317.12 × 12 × 3) = $803416.32.

Let the amount of money that was originally borrowed is $x and the given APR is 4%.

Then we can write,
`x(1 + (4 * 3)/(100)) = 803416.32`

⇒ 1.12x = 803416.32

⇒ x = $717336 (answer)