SOLUTION: If you buy a computer directly from the manufacturer for $ 3,030 and agree to repay it in 48 equal installments at 1.77 % interest per month on the unpaid​ balance, how much

Algebra ->  Finance -> SOLUTION: If you buy a computer directly from the manufacturer for $ 3,030 and agree to repay it in 48 equal installments at 1.77 % interest per month on the unpaid​ balance, how much       Log On


   

Question 1069015: If you buy a computer directly from the manufacturer for $ 3,030 and agree to repay it in 48 equal installments at 1.77 % interest per month on the unpaid​ balance, how much are your monthly​ payments? How much total interest will be​ paid?
Your monthly payment is ​????
.
​(Round to two decimal​ places.)
The total interest paid is ​????
.
​(Round to two decimal​ places.)
Answer by Theo(13342) About Me  (Show Source):
You can put this solution on YOUR website!
the computer costs 3030.
the payment is at the end of each month for 48 months.
the interest rate is 1.77 percent interest per month.

use a financial calculator to solve for this.
one such calculator can be found here:
http://arachnoid.com/finance/

your entries into the calculator are as follows:
present value = 3030
future value = 0
number of time periods = 48
payment amount = 0 or blank (you will solve for this)
interest rate percent per time period = 1.77
payment is at the end of the time period.

you then select pmt and your answer will be:
$94.22 due at the end of each month.

here's a picture of the calculator inputs and result.

$$$

your nominal interest rate is 12 * 1.77 = 21.24 percent per year.

your effective interest rate is 1.0177 ^ 12 - 1 = 23.4347 percent per year rounded to 4 decimal places.

1.0177 ^ 12 means 1.0177 raised to the 12th power.