9. You can afford a $1300 per month mortgage payment. You've found a 30-year loan at 7% interest. a) How big of a loan can you afford? b) How much total money will you pay the loan company? c) How much of that money is interest? 10. You want to buy a $34,000 car. The company is offering a 3% interest rate for 36 months (3 years). What will your monthly payments be?
Added by Todd S.
Step 1
Plugging in the numbers, we get: 1300 = P [ (0.07/12)(1 + 0.07/12)^360 ] / [ (1 + 0.07/12)^360 – 1] Solving for P, we get: P = 225,384.68 So you can afford a loan of $225,384.68. Show more…
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