Question

You have just taken out a $28,000 car loan with a 6%​APR, compounded monthly. The loan is for five years. When you make your first payment in one​ month, how much of the payment will go toward the principal of the loan and how much will go toward​ interest?  ​(Note: Be careful not to round any intermediate steps less than six decimal​ places.)

When you make your first​ payment,​$__will go toward the principal of the loan and​$___ will go toward the interest.  ​(Round to the nearest​ cent.)

Answer 1

	P =	Regular Payments
	PV =	Loan Amount
	r =	rate of interest
	n =	no of periods
	P =	r (PV)
		1 - (1 + r )^-n
	P =	(6%/12)*28000
		1 - (1 / (1 + 6%/12)^60))
	P =	140
		0.258627804
	P =	541.32
	Beginning Balance	Interest	Principal	Ending Balance
1	28000.00	140.00	401.32	27458.68
		(28000 * 6% * 1/12)	(541.32 - 140)	(28000 - 401.32)
	Principal in First Payment	401.32
	Interest in First Payment	140.00