Susan took out a personal loan for $3,500 at an interest rate of 13% compounded monthly. She made arrangements to pay the loan off in 3 years. What will her monthly payment be?
This is a present value of an ordinary annuity question.
It is present value because you have a present value - the future value will be 0.
I assume the interest rate is 13% per annum.
A=3500
i=0.13/12=0.01083 repeater
1+i=1.01083 repeater
n=3*12=36
You have to find R
formula is
$$A=R\times\frac{1-(1+i)^{-n}}{i}$$
okay, you can try the substitution by yourself.
This is a present value of an ordinary annuity question.
It is present value because you have a present value - the future value will be 0.
I assume the interest rate is 13% per annum.
A=3500
i=0.13/12=0.01083 repeater
1+i=1.01083 repeater
n=3*12=36
You have to find R
formula is
$$A=R\times\frac{1-(1+i)^{-n}}{i}$$
okay, you can try the substitution by yourself.