M Qustion 2 of 1 Sots You can afford a $450 per month car payment You've...

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Question

M Qustion 2 of 1 Sots You can afford a $450 per month car payment Youve found a 5 year loan at 2%in A 27.54000 Ca70 CD 15471

business finance

Answer 1

Answer #1

Loan Amount = Monthly Payment * [{1 - (1 + r)^-n} / r]

= $450 * [{1 - (1 + 0.02/12)^-(5*12)} / (0.02 /12)]

= $450 * [0.0951 / 0.0017] = $450 * 57.0524 = $25,673.56

Hence, Option "D" is correct.

Answer 2

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