Question

What formula I use to find out how much my monthly payments need to be.

Information needed. Ending Amount= 71,980
2% interest compounded monthly for 5 years.

Answer 1

To find out how much your monthly payments need to be, you can use the formula for calculating the monthly payment on a loan. The formula is Payment = (Loan Amount * Monthly Interest Rate) / (1 - (1 + Monthly Interest Rate)^(-Number of Months)).

Step-by-step explanation:

To find out how much your monthly payments need to be, you can use the formula for calculating the monthly payment on a loan. The formula is:

Payment = (Loan Amount * Monthly Interest Rate) / (1 - (1 + Monthly Interest Rate)^(-Number of Months))

In this case, the ending amount is $71,980, the interest rate is 2% compounded monthly, and the loan term is 5 years. Therefore, the number of months is 5 * 12 = 60. Plugging in these values into the formula, you can calculate the monthly payment.

Using the given information, the formula becomes:

Payment = ($71,980 * (0.02/12)) / (1 - (1 + (0.02/12))^(-60))

Calculating this expression will give you the amount of the monthly payment.