Someone financed a car today for $25,000. If the loan was for 5 years at 10%,...

Question

Question

Someone financed a car today for $25,000. If the loan was for 5 years at 10%, how much would the monthly payments be?

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business finance

Answer 1

Answer #1

Information provided:

Present value= $25,000

Time= 5 years*12= 60 months

Interest rate= 10%/12= 0.8333

The monthly payment is calculated by entering the belopw in a financial calculator:

PV= -25,000

N= 60

I/Y= 0.8333

Press the CPT key and PMT to compute the monthly payment.

The value obtained is 531.1761.

Therefore, the amount of monthly payment is $531.18.

In case of any query, kindly comment on the solution

Answer 2

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