Using an online loan calculator, determine the total cost of repaying a $750 credit card loan with a 17.99% interest rate compounded monthly and a fixed monthly payment over a period of 9 months. Round the answer to the nearest dollar.(1 point)%0D%0AThe total cost of repaying the loan to the nearest dollar is $.
To determine the total cost of repaying the loan, we need to calculate the monthly payment first.
Using the formula for calculating the fixed monthly payment for a loan:
monthly payment = (principal * monthly interest rate) / (1 - (1+ monthly interest rate)^(-number of months))
First, let's convert the annual interest rate to a monthly interest rate:
monthly interest rate = 17.99% / 12 / 100 = 0.01799 / 12 = 0.00149917
Now we can calculate the monthly payment:
monthly payment = (750 * 0.00149917) / (1 - (1+ 0.00149917)^(-9)) = 90.81
Next, we'll calculate the total cost by multiplying the monthly payment by the number of months:
total cost = monthly payment * number of months = 90.81 * 9 = 817.29
Rounding the answer to the nearest dollar, the total cost of repaying the loan is $817.
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Apologies for the mistake. Let's recalculate the total cost of repaying the loan correctly.
Using an online loan calculator, the total cost of repaying a $750 credit card loan with a 17.99% interest rate compounded monthly and a fixed monthly payment over a period of 9 months can be determined as follows:
1. First, calculate the monthly interest rate:
Monthly interest rate = 17.99% / 12 / 100 = 0.0149958
2. Calculate the monthly payment using the formula:
Monthly payment = (principal * monthly interest rate) / (1 - (1 + monthly interest rate)^(-number of months))
Monthly payment = (750 * 0.0149958) / (1 - (1 + 0.0149958)^(-9))
Monthly payment = 90.90 (rounded to two decimal places)
3. Calculate the total cost by multiplying the monthly payment by the number of months:
Total cost = monthly payment * number of months
Total cost = 90.90 * 9 = 818.10
Rounded to the nearest dollar, the total cost of repaying the loan is $818.