Claudius took out an unsubsidized Stafford loan at the beginning of his six-year college career. The loan had a principal of $4,
850, an interest rate of 6.5% compounded monthly, and a duration of ten years. If Claudius started paying off the loan when he graduated, what is his monthly payment
2 answers:
Answer:
$55.07
Explanation:
In this question we use the PMT formula that is shown in the attachment
Given that,
Present value = $4,850
Future value or Face value = $0
Interest rate = 6.50% ÷ 12 = 0.54%
NPER = 10 years × 12 = 120 years
The formula is shown below:
= PMT(RATE;NPER;-PV;FV;type)
The present value come in negative
So, after solving this, the monthly payment is $55.07
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