Question

If you buy a computer directly from the manufacturer for $ 3,310 and agree to repay it in 60 equal installments at 1.79%interest per month on the unpaid​ balance, how much are your monthly​ payments? How much total interest will be​ paid?

Answer 1

a)	Monthly payment	=	Loan amount	/	Present value of annuity of 1
		=	$       3,310	/	36.59777
		=	$       90.44
	Working;
	Present value of annuity of 1	=	(1-(1+i)^-n)/i		Where,
		=	(1-(1+0.0179)^-60)/0.0179		i	=	Interest rate	=	0.0179
		=	36.597768		n	=	number of period	=	60
b.	Total interest paid		$ 2,116.56
Working;
	Total repayment	=	$       90.44	*	60	=	$ 5,426.56
	Less amount borrowed	=					$ 3,310.00
	Interest paid	=					$ 2,116.56