Answer to Question #189743 in Financial Math for Charles

Question #189743

you want to buy a car, and a local bank will lend you $20,000. The loan will be fully amortized over 5 years(60 months), and the nominal interest rate will be 11% with interest paid monthly. What will be the monthly loan payment? What will be the loans EAR?

Expert's answer

Given:

Monthly payment and effective rate will be

Answers:

Monthly payment is $434.85

Effective rate is 11.57%

Formulas:

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