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Our firm wants to buy new equipment. There will be monthly payments of $12,000 for 3...

Our firm wants to buy new equipment. There will be monthly payments of $12,000 for 3 years at a 6 percent interest (APR=6% with monthly compounding). What is the price of the equipment?

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Answer #1

Monthly Mortgage Payment you can pay = $12,000

Calculating the Loan Amount:-

Where, C= Monthly Mortgage Payment = $12,000

r = Periodic Interest rate = 6%/12 = 0.5%

n= no of periods = 3 years*12 = 36

Present Value = $394,452.19

So, loan amount for price of the equipment is $394,452.19

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