Given:
Loan Amount: $1,800
Loan Terms: 18 months = n
Interest Rate: 17% =
Monthly Loan Payment Formula:
Monthly Loan Payment =
Substitute given values into Monthly Payment Formula:
Monthly Loan Payment =
Monthly Loan Payment = $113.99 ( rounded to two decimal places)
Notes:
Total Cost = Monthly Loan Payment * Number of Payments
Total Cost = $113.99 * 18 = $2,051.82
Interest Cost = Total Cost – Loan Amount
Interest Cost = $2,051.82 – $1,800 = $251.82
Loan Amount: $1,800
Loan Terms: 18 months = n
Interest Rate: 17% =
17/100
= 0.17 = r (convert percent to a decimal)Monthly Loan Payment Formula:
Monthly Loan Payment =
Loan Amount *
r
/
12
/
1 – ( 1+ r/12
) -n
Substitute given values into Monthly Payment Formula:
Monthly Loan Payment =
1,800 *
0.17
/
12
/
1 – ( 1+ 0.17/12
) -18
Monthly Loan Payment = $113.99 ( rounded to two decimal places)
Notes:
Total Cost = Monthly Loan Payment * Number of Payments
Total Cost = $113.99 * 18 = $2,051.82
Interest Cost = Total Cost – Loan Amount
Interest Cost = $2,051.82 – $1,800 = $251.82
