If you were to borrow $9,100 over five years at 0.13 compounded monthly, what would be your monthly payment? Round to two decimal places. check_circle Expert Answer thumb_up thumb_down Step 1 Annuity - Annuity means the amount of series of payments based on fixed intervals periods. The formula used to calculate annuity is = Amount*PAVF(R, N) where PAVF = Present value annuity factor, R = Interest rate , N= no of periods Step 2 In the given question we have, Amount borrowed = $9,100 Interest rate = 0.13% compounded monthly N = no.of periods = 5*12 = 60 periods Let the monthly payment be =x x,PVAF(0.13%,60) = $9,100 X*PVAF(1+0.0013)60 = $9,100 X*61.4396868 = $9,100 how is this calculated? I don't get this number. X = $9,100/61.4396868 X = $ 148.11 monthly payment = $148.11
If you were to borrow $9,100 over five years at 0.13 compounded monthly, what would be your monthly payment? Round to two decimal places. check_circle Expert Answer thumb_up thumb_down Step 1 Annuity - Annuity means the amount of series of payments based on fixed intervals periods. The formula used to calculate annuity is = Amount*PAVF(R, N) where PAVF = Present value annuity factor, R = Interest rate , N= no of periods Step 2 In the given question we have, Amount borrowed = $9,100 Interest rate = 0.13% compounded monthly N = no.of periods = 5*12 = 60 periods Let the monthly payment be =x x,PVAF(0.13%,60) = $9,100 X*PVAF(1+0.0013)60 = $9,100 X*61.4396868 = $9,100 how is this calculated? I don't get this number. X = $9,100/61.4396868 X = $ 148.11 monthly payment = $148.11
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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If you were to borrow $9,100 over five years at 0.13 compounded monthly, what would be your monthly payment? Round to two decimal places.
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Expert Answer
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Step 1
The formula used to calculate annuity is = Amount*PAVF(R, N)
where PAVF = Present value annuity factor, R = Interest rate , N= no of periods
Step 2
In the given question we have,
Amount borrowed = $9,100
Interest rate = 0.13% compounded monthly
N = no.of periods = 5*12 = 60 periods
Let the monthly payment be =x
x,PVAF(0.13%,60) = $9,100
X*PVAF(1+0.0013)60 = $9,100
X*61.4396868 = $9,100 how is this calculated? I don't get this number.
X = $9,100/61.4396868
X = $ 148.11
monthly payment = $148.11
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