Answer:
Step-by-step explanation:
Principal, P = $16,578
Interest rate, r = 12% = 0.12
Monthly interest rate = annual interest rate / 12
= 12%/12
= 1%
= 0.01
Time, t = 1 year
Number of period, n = 12
Car payment per month = $345.00
Month 1:
A = P(1 + r/n)^nt
A = 16,578(1 + 0.01/12)^(12)(1)
A = 16,578(1 + 0.000833333)^(12)
= 16578(1.000833333)^12
= 16578(1.0100459608871)
A = $16,744.54
Principal after month 1 repayment = $16,744.54 - $345
= $16,399.54
Month 2:
A = P(1 + r/n)^nt
= $16,399.54(1 + 0.01/12)^(12)(1)
= 16,399.54(1 + 0.000833333)^(12)
= 16,399.54(1.000833333)^12
= 16399.54(1.0100459608871)
= 16,564.289137406431934
= $16,564.29
Principal after month 2 repayment = $16,564.29 - $345
= $16,219.29
Month 3:
A = P(1 + r/n)^nt
= $16,219.29(1 + 0.01/12)^(12)(1)
= 16,219.29(1 + 0.000833333)^(12)
= 16,219.29(1.000833333)^12
= 16219.29(1.0100459608871)
= 16382.228352956532159
= $16,382.23
Principal after month 3 repayment = $16,382.23 - $345
= $16,037.23
Month 4:
A = P(1 + r/n)^nt
= $16,037.23(1 + 0.01/12)^(12)(1)
= 16,037.23(1 + 0.000833333)^(12)
= 16,037.23(1.000833333)^12
= 16037.23(1.0100459608871)
= 16198.339385317426733
= $16,198.34
Principal after month 4 repayment = $16,198.34 - $345
= $15,853.34
