anonymous 5 years ago Find the monthly payment needed to pay off a loan of \$3900 amortized at 3% compounded monthly for 6 years.

1. amistre64

Pert

2. amistre64

3900 e^(.03)(6)

3. anonymous

The answer doesn't make sense though..

4. amistre64

3900 * (e^(.03 * 6)) = 4,669.14772 Divide that by 72 months to get the payments 64.85

5. anonymous

It says it's wrong :/

6. amistre64

64.84? let me look up the definition for amoritized...

7. anonymous

Yeah, I have this online homework called "Webwork" and it says that's incorrect.. i've already tried

8. amistre64

compunded monthly.....I did continuously becasue I cant read...im going illiterate

9. anonymous

It's okay! lol

10. amistre64

P(1+(.03/12))^(12*6) should be the total amount and then divide tha tby 72 to get the monthlies...

11. amistre64

3 900 * ((1 + (.03 / 12))^(12 * 6)) = 4,668.09902 divide by 72: 64.83 trythat :)

12. anonymous

Nope :/

13. amistre64

....... new tax laws maybe? :)

14. anonymous

haha Maybe.. it's getting tedious though

15. amistre64

P(1+r/n)^(n*t) is the formula. that gives you the total amount of the loan over t years. right?

16. amistre64

$3900(1+\frac{.03}{12})^{12*6}$

17. anonymous

18. amistre64

if it aint that....I dont know what id be..... amortized just means. 59.26 is what an amortization calculator online gives me////

19. anonymous

Thank you though (:

20. anonymous

wait could you please copy and paste that url.. the "amortization calculator online"

21. anonymous

Because I have one more just like this to do that webwork kept saying was wrong

22. amistre64
23. anonymous

what in the world haha

24. amistre64

gotta put in the right numbers :)

25. anonymous

ughhh lol thank you. this is difficult

26. anonymous

:)

27. anonymous

this is more of a finance question a finance calculator like a BA II would help you a lot the math behind it deals with present value equations the value of your payment changes based on how much goes toward principal and how much towards interest since with every payment the balance decreases the interest amount will also decrease over time anyway the equations is this i = .03/12 = .0025 v = 1/(1+i) = .997506 3900 = P(1+v+v^2 +...v^71) sum of (1+v+...) = (1-v^72)/(1-v) = 65.98 P=3900/65.98 = 59.11 this is an approximate answer and prob more info than you need i put this into my BA II and got 59.25