You just purchased a vacant lot for $60,000. You financed thatamount over 180 months. What...

You just purchased a vacant lot for $60,000. You financed that amount over 180 months. What would your monthly payment be if your interest rate was 3.75% compounded monthly?

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Expert Solution

Information provided:

Present value= $60,000

Time= 180 months

Interest rate= 3.75%/12= 0.3125% per month

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

PV= -60,000

N= 180

I/Y= 0.3125

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

The value obtained is 436.33.

Therefore, the monthly payment is $436.33.

jeff jeffy answered 2 years ago

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