mr. greatest bought an aotomobile for $250,000and paid a 20% down payment .it the rate of interest is 6.5% per year, and he agrees to pay the balance in 20 equal monthly installments,what is the amount of each installment?
%Financed = 100% - 20% = 80%.
Po = 0,80 * 250000 = $200,000 = Amt.
financed.
P = (Po*r*t)/(1-(1+r)^-t).
r = (6.5%/12)/100% = 0.005417 = Monthly % rate expressed as ma decimal.
t = 20 Months.
Plug the above values into the given Eq and solve for P.
Answer: P = $211,570.27.
Monthly = P/t.