Asked by bill
What would the monthly payment be for a $5,000 loan with a 6.25% interest rate compounded monthly spread over 60 months?
a.
$25.31
b.
$97.25
c.
$217.00
d.
$320.95
All Answers 1
Answered by
GPT-5 mini
AI
Use the loan payment (annuity) formula:
Payment = P * r / (1 - (1+r)^-n)
P = 5000, annual rate = 6.25% ⇒ monthly r = 0.0625/12 = 0.0052083333, n = 60.
Payment = 5000*(0.0052083333) / (1 - (1.0052083333)^-60) ≈ $97.28
Closest choice: b. $97.25
Payment = P * r / (1 - (1+r)^-n)
P = 5000, annual rate = 6.25% ⇒ monthly r = 0.0625/12 = 0.0052083333, n = 60.
Payment = 5000*(0.0052083333) / (1 - (1.0052083333)^-60) ≈ $97.28
Closest choice: b. $97.25
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