SOLUTION: You can afford a $300 per month car payment. You have found a 5 year loan for 3% interest. How big of a loan can you afford?

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Question 1176030: You can afford a $300 per month car payment. You have found a 5 year loan for 3% interest. How big of a loan can you afford?
Answer by Theo(13342) About Me  (Show Source):
You can put this solution on YOUR website!
you can afford a loan of 16,695.70.

you can use the following online calculator to solve this problem for yourself.
https://arachnoid.com/finance/index.html

your inputs are:

pv = 0
fv = 0
np = 5 years * 12 months per year = 60 months
pmt = -300
ir = 3% / 12 = .25 per month
payment at end of each time period.

click on pv to get your answer.

here's what the results of usint that calculator look like.




there are other charges to buying a car as well.

this only includes the monthly charges for the loan itself.