Question

You have just graduated from college and have been accepted for a position making 56,000 a

year (Gross Income) before taxes. You are looking to upgrade your vehicle. You have a
appointment set up to look at a 2019 Dodge Charger. Your mortgage is about 1,400 a month,
Utilities 250, and groceries 250. Your household expense is 1,900 a month. You have 2,500 saved
in your savings for a down payment for your vehicle. You are looking for a automotive loan. You
can choose 5 years (60 months) or 7 years (84 months). I want you to research different
banks/credit unions to see who offers the lowest interest rate for the amount of years you tend to
pay. I then want you to explain how you plan to explain how much you will be paying each month.
Do not forget that you will be planning on getting a warranty for 2 years through the dealership that
will cost you 55.00 per month on top of you payments per month.
Information needed:
Price of the car
Pre approved amount of the car loan
Interest Rate for a auto loan
Which bank you prefer to go with
How much will you pay per month on your car loan.

Answer 1

is it $55 a month?

Step-by-step explanation:

5-Year Loan (60 months):

Monthly Interest Rate = 0.33%

Number of Months = 60

Car Loan Payment = P * (r * (1 + r)^n) / ((1 + r)^n - 1)

P = $17,500 (loan amount)

r = 0.33% (monthly interest rate)

n = 60 (number of months)

Car Loan Payment = $17,500 * (0.0033 * (1 + 0.0033)^60) / ((1 + 0.0033)^60 - 1)

7-Year Loan (84 months):

Monthly Interest Rate = 0.33%

Number of Months = 84

P = $17,500 (loan amount)

r = 0.33% (monthly interest rate)

n = 84 (number of months)

Car Loan Payment = $17,500 * (0.0033 * (1 + 0.0033)^84) / ((1 + 0.0033)^84 - 1)

these are my steps