Question

The Shelby Cobra retails for ​$37,340 ​(all taxes​ included). What are the monthly loan payments for the car if you make a down payment of ​$4​,481 the term is 4 years and the APR is 15​%? ​ (Car loan payments are made at the end of each​ month.) What is the amount of the monthly​ payment?

Answer 1

Information provided:

Purchase price of car= $37,340

Down payment= $4,481

Time= 4 years*12= 48 months

Interest rate= 15%/12= 1.25% per month

Mortgage= Purchase price of car - Down payment

                  =$37,340 - $4,481

                  = $32,859

The payments are made at the end of the month. It is computed with the financial the end mode. Calculators are in the END MODE by default. The monthly payment is calculated by entering the below in a financial calculator:

PV= -32,859

N= 48

I/Y= 1.25

Press the CPT key and PMT to compute the monthly payment.

The value obtained is 914.49.

Therefore, the monthly payment is $914.49.

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