SOLUTION: I need help on how to plug in the information into the formula and the steps in which I work it. ROUND EACH STEP TO AT LEAST 5 PLACES AND ONLY ROUND TO THE NEAREST CENT AT THE E

Algebra ->  Finance -> SOLUTION: I need help on how to plug in the information into the formula and the steps in which I work it. ROUND EACH STEP TO AT LEAST 5 PLACES AND ONLY ROUND TO THE NEAREST CENT AT THE E      Log On


   

Question 460015: I need help on how to plug in the information into the formula and the steps in which I work it.
ROUND EACH STEP TO AT LEAST 5 PLACES AND ONLY ROUND TO THE NEAREST CENT AT THE END OF THE CALCULATION.
Financed amount 18,500
Term of lean 48 months
Annual rate of interest 11%
I need to use this formula to calculte the monthly payments:
P=A[1-(1+i)^-n/i]^-1
Where P represents your payment, A is the financed amount, i is the monthly interest rate in decimal form (i = annual rate/12), and n is the duration of the loan in months.
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Answer by jim_thompson5910(35256) About Me  (Show Source):
You can put this solution on YOUR website!
... Start with the given formula.


In this case, A = 18500 (the total amount financed, ie loaned out), i = 0.11/12 = 0.00916666666666667 (the monthly interest rate), and n = 48 (number of payments)


... Plug in the given values shown above


... Add


... Raise 1.00916666666667 to the negative 48th power to get 0.645328639529821


... Subtract


... Divide


... Raise 38.6914211422014 to the negative first power to get 0.0258455226114526


... Multiply


So the monthly payment is $478.14 (rounded to the nearest cent).