Allie Dawson is trying to decide whether or not she can afford the monthly payme

Question

Allie Dawson is trying to decide whether or not she can afford the monthly payment of a loan to purchase a new car.  The car costs $19,600.  She is considering a 5-year loan at 6% interest.  How much would her monthly payment be for a loan financing  the full cost of the car? Do not include $ in your answer.

Allie Dawson is trying to decide whether or not she can afford the monthly payment of a loan to purchase a new car.  The car costs $19,600.  She is considering a 5-year loan at 6% interest.  How much would her monthly payment be for a loan financing  the full cost of the car? Do not include $ in your answer.

Explanation / Answer

Hi,

Please find the answer as follows:

Nper = 5

Rate = 6%

PV = 19600

FV = 0

PMT = ?

Monthly Payment = PMT(Rate,Nper,PV,FV) = PMT(6%,5,-19600,0) = 4652.97 or 4653

Answer is 4652.97 or 4653.

Thanks.

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