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Theo borrowed 4500 to purchase a computer. The flat rate interest rate was 3.75% p.a the loan was to be paid back in 24 monthly installments. calculate theos monthly repayments

 Jun 3, 2017
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Theo borrowed 4500 to purchase a computer. The flat rate interest rate was 3.75% p.a the loan was to be paid back in 24 monthly installments. calculate theos monthly repayments.

 

Use this formula to calculate the monthly payment.

PMT=PV. R.{[1 + R]^N/ [1 + R]^N - 1}

PMT = 4,500 x 0.0375/12{[1 + 0.0375/12]^24 / [1 + 0.0375/12]^24 - 1}

PMT = 14.0625 x {[ 1.003125]^24 /[1.003125]^24 -1}

PMT = 14.0625 x                        13.86039550.........

PMT = $194.91 - This is the monthly payment to pay off the loan in 24 months.

P.S. I have used your 3.75% as compounded monthly.

 Jun 3, 2017

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