Asked Nov 19, 2019

Suppose you borrow 11,000 for 5 years at 6% towards the purchase of a car. What would be the monthly payments and total interest for the loan? 


Expert Answer

Step 1

The computation of monthly payments:

Hence, the monthly payment is 212.66.


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Principal 11000 6 = 0.5%Per month 12 Rate of interest Number of years =5x12 = 60Months Pxrx (1+r) (1- Monthly paym ents =i 11000 x0.005 x (1+0.005) ° (1+0.005) -1 =212.66

Step 2

The computation of total payment:

Hence, the total of monthly payment is 12759.6


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Total of monthly payment Monthly paym ent x60 -212.66x60 = 12759.6


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