document.write( "<A HREF=/cgi-bin/jump-to-question.mpl?question=1200914>Question 1200914</A>: <I><SPAN STYLE=\"word-break: break-all;\"> The price of a new car is $40,000. Assume that an individual makes a down payment of 25% toward the purchase of the car and secures financing for the balance at the rate of 7%/year compounded monthly. (Round your answers to the nearest cent.)<BR>\n" );
document.write( "(a) What monthly payment will she be required to make if the car is financed over a period of 36 months? Over a period of 60 months?\r<BR>\n" );
document.write( "\n" );
document.write( "36 months:   	<BR>\n" );
document.write( "60 months:  \r<BR>\n" );
document.write( "\n" );
document.write( "(b) What will the interest charges be if she elects the 36-month plan? The 60-month plan?\r<BR>\n" );
document.write( "\n" );
document.write( "36-month plan:    	<BR>\n" );
document.write( "60-month plan :   	 </SPAN>\n" );
document.write( "</I><HR><TABLE width=100%><TR><TD><B><A HREF=http://www.algebra.com/>Algebra.Com's</A> Answer #835157 by </B><A HREF=/tutors/aboutme.mpl?userid=Theo><B>Theo(13342)</B></A><img src=\"/images/stars/stars-13.gif\" alt=\"\" >&nbsp;<A HREF=/tutors/aboutme.mpl?userid=Theo><IMG SRC=http://www.algebra.com/images/aboutme-small.gif BORDER=0 alt=\"About Me\" VALIGN=MIDDLE></A>&nbsp;<IMG SRC=http://www.algebra.com/cgi-bin/show-face.mpl?user=Theo><BR>You can <A HREF=\"/cgi-bin/embed-solution.mpl?show=1&solution=835157\">put this solution on YOUR website!</A><BR><SPAN STYLE=\"word-break: break-all;\"> present value of loan = 40,000 minus .25 * 40,000 = .75  * 40,000 = 30,000.<BR>\n" );
document.write( "interest rate = 7% pr year / 12 = .58333.....% per month.<BR>\n" );
document.write( "number of months of loan equal 36 and 60.<BR>\n" );
document.write( "monthly payment for 36 month loan is 926.31.<BR>\n" );
document.write( "monthly payment for 60 month loan is 594.04.<BR>\n" );
document.write( "total interest charges on 36 month loan are 36 * 926.31 minus 30,000 = 3347.16.<BR>\n" );
document.write( "total interest charges on 60 month loan are 60 * 594.04 minus 30,000 = 5642.4.<BR>\n" );
document.write( "the monthly payments were rounded to the nearest penny.<BR>\n" );
document.write( "if not, then:<BR>\n" );
document.write( "monthly payment for 36 month loan is 926.312906.<BR>\n" );
document.write( "monthly payment for 60 month loan is 594.0359562.<BR>\n" );
document.write( "total interest charges on 36 month loan are 36 * 926.312906 minus 30,000 = 3347.264615; rounds to 3347.26.<BR>\n" );
document.write( "total interest charges on 60 month loan are 60 * 594.0359562 minus 30,000 = 5642.157373; rounds to 5642.16.<BR>\n" );
document.write( "these are very minor differences, but they are there.<BR>\n" );
document.write( "online calculator gave the rounded intermediate results.<BR>\n" );
document.write( "ti-BA-ii calculator gave the less rounded intermediate results.<BR>\n" );
document.write( "either answer is good, depending on how they are marked.\r<BR>\n" );
document.write( "\n" );
document.write( " </SPAN>\n" );
document.write( "</TD></TR></TABLE>\n" );