Question

Michelle bought a car that costs $25,800 and put a down of $8,000 on it. The car loan is for 60 months and has an interest rate of 3.99%. How much will she actually pay for the car? What will her monthly payment be?

Please show you’re work and be specific for both questions. Due at 10 pm!!

Answer 1

$20239.6

Explanation:

The amount financed for the car is $25,800 - $8,000 = $17,800.

To find the monthly payment, you can use the formula:

M = P [ i(1 + i)^n ] / [ (1 + i)^n – 1]

where M is the monthly payment, P is the amount financed, i is the monthly interest rate (3.99%/12), and n is the number of payments (60 months).

So,

i = 3.99%/12 = 0.00399

n = 60

M = $17,800 [ 0.00399(1 + 0.00399)^60 ] / [ (1 + 0.00399)^60 – 1]

M ≈ $337.31

So, Michelle will make monthly payments of $337.31 for 60 months.

To find the total amount that Michelle will pay for the car, you can multiply the monthly payment by the number of payments:

$337.31 x 60 = $20239.6

So, the total amount that Michelle will pay for the car is $20239.6