Asked by
CHRISTIAN MOJICA
on Dec 02, 2024
Verified
Assume you want to pay off your $10,000, 30-month car loan after only the first 12 months of payments. With interest at 12% compounded monthly, how much will you need pay off the loan in full at the end of the first year?
A) $5,639
B) $6,354
C) $4,361
D) $7,425
Compounded Monthly
Interest on an investment or loan calculated monthly and added to the principal sum for future interest calculations.
Pay Off
To settle a debt or obligation by making a payment, either in partial settlements or in full, to clear the owed amount.
Car Loan
A car loan is a financial agreement where a lender provides funds to a borrower for the purchase of a vehicle, which is paid back with interest over a set period.
- Recognize and examine the advantages and disadvantages associated with acquiring loans, together with computing the cumulative interest payments throughout the duration of the loan.
- Acquire the ability to compute and understand the payment figures for mortgages, loans, and annuities, inclusive of situations with extra payments.
Verified Answer
MM
Learning Objectives
- Recognize and examine the advantages and disadvantages associated with acquiring loans, together with computing the cumulative interest payments throughout the duration of the loan.
- Acquire the ability to compute and understand the payment figures for mortgages, loans, and annuities, inclusive of situations with extra payments.