If you were to borrow $9,100 over five years at 0.12 compounded monthly, what would be your monthly payment?
| Monthly Payment | = | Amount borrowed /Present Value of annuity of 1 | |||||||||
| = | $ 9,100 | / | 44.9550 | ||||||||
| = | $ 202.42 | ||||||||||
| Working: | |||||||||||
| Present Value of annuity of 1 | = | (1-(1+i)^-n)/i | Where, | ||||||||
| = | (1-(1+0.01)^-60)/0.01 | i | 0.12/12 | = | 0.01 | ||||||
| = | 44.9550 | n | 5*12 | = | 60 | ||||||
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