Question

A bank requires a monthly payment of $32.88 on a $2500 loan. At the same rate find the monthly payment on a $50,000 loan

Answer 1

$ 657.6

Step-by-step explanation:

Step 1:

Given,

Principal = $2500

Monthly payment  = $32.88

Step 2 :

The amount of monthly payment and the principal amount are in direct proportion , that is when the principal amount increases the monthly payment increases and when the principal decreases the monthly payment decreases.

Step 3 :

The monthly payment for $2500 is $32.88

Therefore for a principal of $50000, the amount of  monthly payment is

32.88 *50000/2500 = $657.6