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Mex, Inc. recently purchased a new machine costing $300,000. Thefirm financed this purchase at 6%...

Mex, Inc. recently purchased a new machine costing $300,000. The firm financed this purchase at 6% interest with monthly payments of $5,799.84. How many years will it take the firm to pay off this debt?

Solutions

Expert Solution

The number of years is computed as follows:

Plug the below variables in the financial calculator as follows:

PV = - 300,000

FV = 0

PMT = 5,799.84

I/Y = 0.50 (6 / 12)

Finally press CPT and then N. It will give N equal to 60 months. So, the number of years will be as follows:

= 60 / 12

= 5 years

jeff jeffy answered 2 years ago
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