Question

Makenzie is looking to purchase a used Jeep Wrangler that costs $21,000. She will make a $4,000 down payment and borrow the remaining with a 60-month loan that has an annual interest rate of 5.3%. Determine Makenzie’s monthly car payment to the nearest dollar amount.
PLEASE HELP ASAP !!!

Answer 1

Answer:

$323

Step-by-step explanation:

The monthly payment can be calculated using the formula:

$M=\frac{P(\frac{r}{12})(1+\frac{r}{12})^n}{(1+\frac{1}{12})^n-1}$

where:

• M=monthly payment
• P=amount borrowed
• r=annual interest rate
• n=total number of monthly payments:

Our parameters are defined as:

$n=60\\P=21000-4000=17000\\r=5.3%$

We plug our parameters in the equation to solve for M;

$M=M=\frac{P(\frac{0.053}{12})(1+\frac{0.053}{12})^n}{(1+\frac{0.053}{12})^{60}-1}$

$=\frac{P(\frac{0.053}{12})(1+\frac{0.053}{12})^{60}}{(1+\frac{0.053}{12})^{60}-1}\\\\\\=323.15$

$=323.15\approx\ 323$

Hence, the monthly payment is $323