Question

You want to buy a new sports car from Muscle Motors for $57,000. The contract is in the form of an annuity due for 72 months at an APR of 10.25 percent. What will your monthly payment be

Answer 1

A = $1,108.96 per month

Step-by-step explanation:

In this case, we need to apply the formula for present value of an ordinary annuity on the assumption that payment is made on monthly basis. The present value, interest rate (APR), number of years and number of installments in a year were provided in the question with the exception of monthly payment.