Question 1066264: How much would it cost to finance $400.00 over 20 years @ 3.25% interest?
Thanks!
Answer by swincher4391(1107)   (Show Source):
You can put this solution on YOUR website! Your question is incomplete, but I will assume that you intend to make monthly payments and that the 3.25% is compounded monthly. If either of these assumptions are incorrect, shoot me an email @ swincher4391@yahoo.com.
Anyway, to answer your question:
We need to solve for our monthly payment. Let's call it P.
So, we have that A = P*(1-(1+r/n)^(-nt))/r, where A is our financing amount, P is our payment, r is our rate, n is the number of times compounded in a year, and t is the number of years we are financing over. Notice we have A = 400, r = .0325, n = 12, and t = 20.
So 
Simplifying a bit we get that  So P ~ $2.27 a month.
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