Question
A car with a sticker price of $42,200 with factory and dealer rebates of $5,100
(a) Find the monthly payment if financed for 60 months at 0% APR. (Round your answer to the nearest cent.)
$ 1
(b) Find the monthly payment if financed at 2.5% add-on interest for 60 months. (Round your answer to the nearest cent.)
$ 2
(c) Use the APR approximation formula to find the APR for part (b). (Round your answer to one decimal place.)
3 %
(a) Find the monthly payment if financed for 60 months at 0% APR. (Round your answer to the nearest cent.)
$ 1
(b) Find the monthly payment if financed at 2.5% add-on interest for 60 months. (Round your answer to the nearest cent.)
$ 2
(c) Use the APR approximation formula to find the APR for part (b). (Round your answer to one decimal place.)
3 %
Answers
Henry
a.(42200-5100)/60 = $618.33 Per Month.
b. Po = 42200-5100 = Amount Financed.
P = (Po*r*t)/(1-(1+r)^-t)
r = (2.5%/12)/100% = 0.002083 = Monthly
% rate expressed as a decimal.
t = 60 months.
Plug the above values into the given Eq and get P = $39,505.80.
Monthly = P/60.
b. Po = 42200-5100 = Amount Financed.
P = (Po*r*t)/(1-(1+r)^-t)
r = (2.5%/12)/100% = 0.002083 = Monthly
% rate expressed as a decimal.
t = 60 months.
Plug the above values into the given Eq and get P = $39,505.80.
Monthly = P/60.