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You want to buy a car and have negotiated a sale price of $50,000. You can get a loan from your local bank at a rate of 6% annually for 6 years. What is your MONTHLY payment?

You want to buy a car and have negotiated a sale price of $50,000. You can get a loan from your local bank at a rate of 6% annually for 6 years. What is your MONTHLY payment?

Essentials Of Investments
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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You want to buy a car and have negotiated a sale price of $50,000. You can get a loan from your local bank at a rate of 6% annually for 6 years. What is your MONTHLY payment? Reference the below formulas when solving the problem above: PV = FV / (1+r)^t FV = PV(1+r)^t FVA = PMT(((1+r)^t) -1) / r FVA = PMT((1+(r/12)^t(12))-1)/(r/12) PVA = PMT(((1-(1+r)^-t) / r)) PVA = PMT((1-(1+(r/12))^-t(12)))/(r/12)
Transcribed Image Text:You want to buy a car and have negotiated a sale price of $50,000. You can get a loan from your local bank at a rate of 6% annually for 6 years. What is your MONTHLY payment? Reference the below formulas when solving the problem above: PV = FV / (1+r)^t FV = PV(1+r)^t FVA = PMT(((1+r)^t) -1) / r FVA = PMT((1+(r/12)^t(12))-1)/(r/12) PVA = PMT(((1-(1+r)^-t) / r)) PVA = PMT((1-(1+(r/12))^-t(12)))/(r/12)
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