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The original sale price of a car is $22,194.96. The required down payment is $1,410. What...

The original sale price of a car is $22,194.96. The required down payment is $1,410. What is the monthly payment if the customer can apply for a 3-year auto loan with a promotional financing rate at 2.99%?

$577.36

$598.25

$604.36

$645.36

Solutions

Expert Solution

EMI = [P x R x (1+R)^N]/[(1+R)^N-1]
Where,
EMI= Equal Monthly Payment
P= Loan Amount =$22194.96-1410 =20784.96
R= Interest rate per period =2.99%/12 =0.24916667
N= Number of periods =12*3 =36
= [ $20784.96x0.00249166667 x (1+0.00249166667)^36]/[(1+0.00249166667)^36 -1]
= [ $51.7891920692832( 1.00249166667 )^36] / [(1.00249166667 )^36 -1
=$604.36

jeff jeffy answered 3 years ago
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