Question

On this slide, use a calculator to find 3-, 4-, and 5-year monthly payments with at least two different down payments. (The down payment cannot be more than $1000.00.)

A. $500 down payment
B. $800 down payment
C. $1000 down payment
D. $1200 down payment

Answer 1

To calculate the monthly payments for different down payment amounts, use the formula for calculating monthly loan payments.

Step-by-step explanation:

To calculate the monthly payments for each down payment amount, we will use the formula for calculating the monthly payments of a loan:

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

Where P is the principal amount, r is the monthly interest rate, and n is the total number of payments.

For each down payment amount, we will assume a loan amount of $10,000 and an interest rate of 6% per year.

For a $500 down payment, the principal amount would be $9,500. Plugging this into the formula, we get:

Monthly Payment = 9500 * (0.06/12) * (1+0.06/12)^(3*12) / ((1+0.06/12)^(3*12)-1)

Similarly, we can calculate the monthly payments for the other down payment amounts:

B. $800 down payment

C. $1000 down payment

D. $1200 down payment