Problema Solution
You have decided to buy a new computer for $1,500 and agreed to pay in 36 equal payments at 1.75% interest per month on the unpaid balance. How much are your payments?
Answer provided by our tutors
we use the following formula for monthly payments since none is provided in the problem statement:
let 'm' represent the monthly payment, 'p' the principal amount of the loan, 'r' the percentage interest rate, 'N' the number of payments:
m = p(r/(1-(1+r)^-N)
so we have:
m = 1500(0.0175/(1-(1+0.0175)^-36))
solving for 'm' we have m=56.51
the monthly payments would be approximately $56.51