(Nonannual compounding using a calculator) Prof. Finance is thinking about tradi

Question

(Nonannual compounding using a calculator) Prof. Finance is thinking about trading cars. He estimates he will still have to borrow $23,000 to pay for his new car. How large will Prof. Finance's monthly car loan payment be if he can get a 6-year (72 equal monthly payments) car loan from the university's credit union at 9.9 percent? If Prof. Finance can get a $23,000 6-year (72 equal monthly payments) car loan from the university's credit union at 9.9 percent, how large will his monthly car loan payment be? $ (Round to the nearest cent.)

Explanation / Answer

monthly payement =(23000*(1+0.09)^6)/(12*6) =38,573.3/72 =535.74$

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