Question 1170456
Let's break down the Estimation Rule for Short-Term Loans and apply it to this problem.

**Estimation Rule for Short-Term Loans:**

The estimation rule provides an approximate monthly payment for short-term loans. The formula is:

Monthly Payment ≈ (Total Loan + Total Interest) / Number of Months

**1. Calculate the Total Interest:**

* **Loan Amount (P):** $27,000
* **Annual Percentage Rate (APR) (r):** 5% or 0.05
* **Loan Term (t):** 2 years

Total Interest = P * r * t
Total Interest = $27,000 * 0.05 * 2
Total Interest = $2,700

**2. Calculate the Total Loan Amount:**

Total Loan Amount = Loan Amount + Total Interest
Total Loan Amount = $27,000 + $2,700
Total Loan Amount = $29,700

**3. Calculate the Number of Months:**

Number of Months = Loan Term (years) * 12
Number of Months = 2 * 12
Number of Months = 24

**4. Estimate the Monthly Payment:**

Monthly Payment ≈ Total Loan Amount / Number of Months
Monthly Payment ≈ $29,700 / 24
Monthly Payment ≈ $1237.50

**Therefore, the estimated monthly payment is $1237.50.**