Question

Suppose that you decide to buy a car for $32,635, including taxes and license fees. You saved $9,000 for a down payment and can get a four year car loan at 6.31%. Find the monthly payment and the total interest for the loan. Equation below.

Answer 1

Step 1:

In this question, we are given the following:

Suppose that you decide to buy a car for $32,635, including taxes and license fees.

You saved $9,000 for a down payment and can get a four-year car loan at 6.31%.

Find the monthly payment and the total interest for the loan.

Step 2:

In this question, we are given:

Cost of the car = $ 32, 635

Down payment = $ 9000

Principal on the Car loan = $ ( 32,635 - 9,000 ) = $ 23, 635

Rate = 6. 31%

Using the PMI Formulae, we have that: