MATH

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IF LOAN BALANCE IS 34,000.00 AND YOU PAY $597.21 MONTHLY AT 7.50 INTEREST HOW MUCH TIME WILL YOU CUT OFF TERM OF LOAN IF YOU ADD 100.00 TO MONTHLY PAYMENT

  • MATH -

    original plan:
    payment = 597.21
    i = .075/12 = .00625
    n = ?

    34000 = 597.21 (1 - 1.00625^-n)/.00625
    .3558212.. = 1 - 1.00625^-n
    1.00625^-n = .644178764
    -n(log 1.00625) = log .64417..
    -n = -70.58
    n = 70.58 months

    new plan:
    payment = 697.21

    everything stays the same,
    repeat the above steps to find the new n value

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