9514 1404 393
Answer:
- monthly payment: $528.39
- interest paid: $3,703.40
Step-by-step explanation:
The monthly payment is given by the amortization formula:
A = P(r/12)/(1 -(1 +r/12)^(-12t))
where the annual interest rate is r for t years on loan value P.
Filling in the given information, we find the monthly payment to be ...
A = $28000(0.05/12)/(1 -(1 +0.05/12)^(-12·5)) ≈ $528.39
The monthly payment is $528.39.
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The total amount repaid is ...
($528.39/mo)(60 mo) = $31,703.40
The interest paid is the difference between this and the loan amount:
interest paid = $31,703.40 -28,000 = $3,703.40
The total interest paid is $3,703.40.
