Kate borrowed $19500 to buy a car. She paid the money back, plus interest in equal monthly repayments of $370 for the next 5 years
How much did she pay in interest?
Working out please :)
To find the monthly interest rate i, you will have to solve this complicated equation.
19500 = 370( 1 - (1+i)^-60)/i
You will have to use either a computer program or use iteration to do that.
I found the annual interest rate to be around 5.3% with this online calculator
http://www.onlineloancalculator.org/
set balance = 19500
set downpayment, trade-in, and sales tax = 0
set interest rate = 5.3
to get a payment of $370.68
by adjusting the interest rate, you might get the payment closer to $370.00