Question

Pat Radigan is planning to buy a Toyota hybrid for $18,969 with $2,300 down and plans to finance the car. Citizens' Financial Bank quoted a finance charge at 8% for 48 months; Charter One Bank quoted him a finance charge at 7.5% for 60 months. a. What would be his monthly payment to Citizens' Financial Bank? (Do not round intermediate calculations. Round your answer to the nearest cent.) & Answer is complete but not entirely correct. Monthly payment $ 456.43 b. What would be his monthly payment to Charter One Bank? (Do not round intermediate calculations. Round your answer to the nearest cent.) Monthly payment

Answer 1

Ans a) $ 406.94

P =	Regular Payments
PV =	Loan Amount
r =	rate of interest
n =	no of periods
P =	r (PV)
	1 - (1 + r )-n
P =	(8%/12)*16669
	1 - (1 / (1 + 8%/12)^48))
P =	111.1266667
	0.27307942
P =	406.94

Ans b) $ 334.01

Loan Amount =	Total Cost - Downpayment
	18969 - 2300
	16669
P =	Regular Payments
PV =	Loan Amount
r =	rate of interest
n =	no of periods
P =	r (PV)
	1 - (1 + r )-n
P =	(7.5%/12)*16669
	1 - (1 / (1 + 7.5%/12)^60))
P =	104.18125
	0.311908176
P =	334.01