Question

Derek borrows $43,863.00 to buy a car. He will make monthly payments for 6 years. The car loan has an interest rate of 5.27%. After a 15.00 months Derek decides to pay off his car loan. How much must he give the bank?

Answer Format: Currency: Round to: 2 decimal places.

Answer 1

For calculating the loan repaid at month 15 we need to create amortization table for 15 months

	Beginning Balance= 43863	PMT =PMT(5.27%/12,72,-43863)	Interest part of PMT=5.27%/12*Beginning Principal	Principal part of PMT= PMT-Interest	Ending Balance= Beginning balance-Principal part of PMT
1	$43,863.00	$711.92	192.63	$519.29	$43,343.71
2	$43,343.71	$711.92	190.35	$521.57	$42,822.15
3	$42,822.15	$711.92	188.06	$523.86	$42,298.29
4	$42,298.29	$711.92	185.76	$526.16	$41,772.13
5	$41,772.13	$711.92	183.45	$528.47	$41,243.67
6	$41,243.67	$711.92	181.13	$530.79	$40,712.88
7	$40,712.88	$711.92	178.80	$533.12	$40,179.76
8	$40,179.76	$711.92	176.46	$535.46	$39,644.30
9	$39,644.30	$711.92	174.10	$537.81	$39,106.48
10	$39,106.48	$711.92	171.74	$540.17	$38,566.31
11	$38,566.31	$711.92	169.37	$542.55	$38,023.76
12	$38,023.76	$711.92	166.99	$544.93	$37,478.83
13	$37,478.83	$711.92	164.59	$547.32	$36,931.51
14	$36,931.51	$711.92	162.19	$549.73	$36,381.78
15	$36,381.78	$711.92	159.78	$552.14	$35,829.64

After 15 months he must give o the bank = $35,829.64

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