Answer to Question #285510 in Financial Math for Ella

Question

PC Yaw Inc. approached Rudy and offered to lend him a capital for his 

computer business amounting to ₱300,000.00 to be paid in 3 years with 12% 

monthly interest. How much would be is his monthly payment?

Answer 1

Use the formula:

$$P = R\cdot\dfrac{1-(1+i/n)^{-nt}}{i/n}$$

In finding $R,$ Regular (monthly) payment, we use: 

$$R=P\cdot\dfrac{i/n}{1-(1+i/n)^{-nt}}$$

Given $P=300000.00, i=0.12, n=12, t=3$

$$R=300000\cdot\dfrac{0.12/12}{1-(1+0.12/12)^{-12(3)}}$$

$$R=9964.29$$

His monthly payment would be $₱9964.29.$