Respuesta :
Part of the amount is paid at the start which reduces the finance charge
(interest paid) for the loan.
Correct responses (approximate) values:
(a) $4,000
(b) $16,000
(c) $619.97
(d) $2,599.09
Methods used to calculate the payments for the loan
The price of the small plane = $20,000
The down payment for the plane = 20% of the price
Annual Percentage Rate, APR, of the loan, r = 12% = 0.12
Duration of payment for the loan = 30 months
a. The down payment = 20% of $20,000, which gives
- [tex]Down \ payment = \mathbf{\dfrac{20}{100} \times \$ 20,000} = \underline{ \$4,000}[/tex]
b. Amount of the loan = Plane price - Down payment
Therefore;
- Amount of the loan, P = $20,000 - $4,000 = $16,000
c. The monthly payment, is given as follows;
[tex]M = \mathbf{ \dfrac{P \cdot \left(\dfrac{r}{12} \right) \cdot \left(1 + \dfrac{r}{12} \right)^n}{\left(1 + \dfrac{r}{12} \right)^n - 1 }}[/tex]
Which gives;
[tex]M = \mathbf{\dfrac{16,000 \times \left(\dfrac{0.12}{12} \right) \times \left(1 + \dfrac{0.12}{12} \right)^{30} }{\left(1 + \dfrac{0.12}{12} \right)^{30} - 1 }} \approx 619.97[/tex]
- The monthly payment, M = $619.97
d. Finance charge = Total payment - Loan amount
Therefore;
Finance charge ā 30 Ć 619.97 - 16,000 = 2,599.09
- The finance charge is approximately $2,599.09
Learn more about mortgage payment here:
https://brainly.com/question/2151755
