A loan of $30,000 is to be paid off with equal monthly payments over a period of 7½ years. If the first payment is made one month after the loan being accepted and the fixed interest rate is 6%p.a. compound monthly, calculate the amount of the monthly payment. Then calculate how much interest in total is paid?
Added by Eldin K.
Step 1
- Principal amount (P) = $30,000 - Time (T) = 7.5 years (Since payments are monthly, convert years to months: 7.5 years * 12 months/year = 90 months) - Annual interest rate (r) = 6% or 0.06 (as a decimal) - Monthly interest rate = Annual interest rate / 12 = 0.06 Show more…
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