You decide to take out a car loan for $20,000 at 7% APR for 60 months.How much are your monthly payments?
A)$396.02
B)$333.33
C)$406.48
D)$400.00
E)$367.54

Question

Quizplus · Accepted Answer

The monthly payment for a car loan can be calculated using the formula:Monthly Payment = (Loan Amount * Annual Interest Rate / 12) / (1 - (1 + Annual Interest Rate / 12)^(-Number of Months))Plugging in the given values, we get:Monthly Payment = (20000 * 0.07 / 12) / (1 - (1 + 0.07 / 12)^(-60))= 396.02Therefore, the correct answer is A) $396.02.

You Decide to Take Out a Car Loan for $20,000