Use the attached formula.
r = 6 / 1,200 = .005
Principal = 15,000
n = number of payments = 5 yrs * 12 months = 60
TOTAL Loan Cost = (.005 * 15,000 * 60) / 1 -(1.005^-60)
TOTAL Loan Cost = 4,500 / (1 - <span> <span> <span> 0.7413721962</span></span></span>)
TOTAL Loan Cost = 4,500 / <span> <span> <span> 0.2586278038 </span> </span> </span>
TOTAL Loan Cost = <span> <span> <span> 17,399.52</span></span></span>
Although it is NOT one of the choices, I think my answer of 17,399.52 is correct. Using a monthly loan payment calculator, I get 289.99 for the monthly payment. 290*60 months = 17,400 so that seems correct.
I do not think that formula you posted is correct. (Compare it to the one I posted.)
r = 6 / 1,200 = .005
Principal = 15,000
n = number of payments = 5 yrs * 12 months = 60
TOTAL Loan Cost = (.005 * 15,000 * 60) / 1 -(1.005^-60)
TOTAL Loan Cost = 4,500 / (1 - <span> <span> <span> 0.7413721962</span></span></span>)
TOTAL Loan Cost = 4,500 / <span> <span> <span> 0.2586278038 </span> </span> </span>
TOTAL Loan Cost = <span> <span> <span> 17,399.52</span></span></span>
Although it is NOT one of the choices, I think my answer of 17,399.52 is correct. Using a monthly loan payment calculator, I get 289.99 for the monthly payment. 290*60 months = 17,400 so that seems correct.
I do not think that formula you posted is correct. (Compare it to the one I posted.)