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Jesse Pinkman is thinking about trading Cars.


 (Nonannual compounding using a calculator) Jesse Pinkman is thinking about trading Cars. He estimates he will still have to borrow $21,000 to pay for his new car. How large will Jesse's monthly car loan payment be if he can get a 2-year (24 equal monthly payments) car loan from the university's creat union at an APR of 6.9 percent compounded month? 


Jesse's monthly car loan payment will be $ _______ (Round to the nearest cent)

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Answer #1

Monthly rate of interest = 6.9%/12 = 0.575%

Number of payments = 24

Monthly payment = Amount of Loan/Present value annuity factor

= 21,000/PVAF(0.575%, 24 periods)

= 21,000/22.35773

= $939.27

Hence, monthly payment = $939.27

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