Question

You want to buy a car. The loan amount will be $15,000. The company is offering a 4% interest rate for 60 months (5 years). What will your monthly payments be?

Answer 1

The monthly payments for the $15,000 car loan with a 4% interest rate for 60 months will be approximately $277.98.

Step-by-step explanation:

To calculate the monthly payments, we can use the formula for the present value of an annuity:

Monthly Payment = PV / ((1 - (1+r)^(-n)) / r)

Where:

• PV is the loan amount, which is $15,000
• r is the monthly interest rate, which is 4% divided by 12 (0.04/12)
• n is the number of months, which is 60

Plugging the values into the formula:

Monthly Payment = $15,000 / ((1 - (1+0.04/12)^(-60)) / (0.04/12)) = $277.98

Therefore, the monthly payments will be approximately $277.98.