Question

You want to buy a $22,000 car. The company is offering a 4% interest rate for 60 months (5 years). What will your monthly payments be ?

Answer 1

Step 1

Given;

`\begin{gathered} Price\text{ of car = \$22,000} \\ Interest\text{ rate=}(4)/(100)=0.04 \\ Time=\text{ 5 years=60 months} \end{gathered}`

Required; To find your monthly payment

Step 2

State the monthly payment formula.

`P_o=(d(1-(1+(r)/(k))^(-kn)))/((r)/(k))`
`\begin{gathered} d=\text{ monthly payment} \\ 22000=(d(1-(1+(0.04)/(12))^(-12(5))))/((0.04)/(12)) \\ 22000=(d(0.1809968963))/((1)/(300)) \\ d=\text{ \$}405.16348 \\ d=\text{ \$405.16} \end{gathered}`

Answer;