Question

Financial Math question:

Brian took eight years to pay off his $71,900 loan. The loan had an interest rate of 8.16%, compounded quarterly. If Brian paid quarterly and made the same payment every time, how much was each payment that he made?

a.

$2,342.66

b.

$3,081.54

c.

$1,022.28

d.

$1,466.76


The lesson didn't teach me how to isolate the variable that finds the payment each quarter:/

Answer 1

The letter varies depending on if it's a practice test or a topic test but the answer is $3,081.54

Answer 2

The answer is letter B. This is through using the formula of compound interest which is divided in quarterly. This means the number of months are only 3. SO compound interest is equal to Principal amount(1+rate/number of months)^number of months x time. This will give you the answer of $3,081.54.