Answer: To calculate the monthly payment for a loan, we can use the formula for the monthly payment on a fixed-rate loan:
Monthly Payment = (P * r * (1 + r)^n) / ((1 + r)^n - 1)
Where:
P = Principal amount (the amount borrowed) = $3825
r = Monthly interest rate = Annual interest rate / (12 * 100) = 15 / (12 * 100) = 0.0125 (decimal)
n = Number of monthly payments = 4 years * 12 months/year = 48
Now, let's plug in the values:
Monthly Payment = (3825 * 0.0125 * (1 + 0.0125)^48) / ((1 + 0.0125)^48 - 1)
Using a calculator, evaluate the expressions:
Monthly Payment = (3825 * 0.0125 * 1.70804007995) / (1.70804007995 - 1)
Monthly Payment = (51.8922) / (0.70804007995)
Monthly Payment ≈ 73.2898
Rounded to the nearest cent, the monthly payment will be approximately $73.29.