Question

For the car loan describes; give the following information. A messenger advertisement offers & $4,000 used car for nothing down and J6 easy monthly payments of $1476?

(a) amount to be paid
(b) amount of interest
(c) interest rate (Round your answer to two decimal places,)
(d) APR (rounded to the nearest tenth of a percent)

Answer 1

The total amount to be paid for the car loan is $53,136, the interest amount is $49,136. The monthly and APR interest rates cannot be calculated with the information provided, as we would need additional financial details or equations.

Step-by-step explanation:

Let's calculate the requested details for the car loan:

1. Amount to be paid: This is the total of the monthly payments. The number of payments is 36, and each payment is $1476. So the total amount paid is 36 × $1476 = $53,136.
2. Amount of interest: This is the total amount paid minus the principal amount of the loan. The principal here is $4,000, and the total amount paid is $53,136, so the interest is $53,136 - $4,000 = $49,136.
3. Interest rate: Determining the monthly interest rate requires an amortization formula or a financial calculator as it involves solving for the interest rate in a compound interest equation. However, the details provided are insufficient to accurately calculate the monthly interest rate without additional financial terms.
4. APR (Annual Percentage Rate): Similarly to the interest rate, the APR calculation would normally involve converting the monthly rate back to an annual rate and taking into account any compounding. Without knowing the compounded interest rate, we cannot provide the APR.