You buy a car for $38,000. you agree to a 60-month loan with a monthly interest rate of 0.55 percent. what is your required monthly payment?

Question

asked Sep 2, 2024 213k views

1 Answer

Krina Soni · Answer 1 · 2024-09-09T02:22:23+0000

The required monthly payment for a $38,000 car loan with a 60-month term and a 0.55% monthly interest rate is $756.47.

To calculate the required monthly payment, we can use the formula for the monthly payment on a loan:

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

Plugging in the given values, we have:

Principal = $38,000

Monthly Interest Rate = 0.55% = 0.0055

Number of Months = 60

Substituting these values into the formula, we can calculate the required monthly payment to be $756.47.