The monthly payment for the contract of $55,000 for a period of 60 months and at the given rate of interest will be $1063.30.
What is monthly payment?
A recurring mode of payment in which the payments at charged at a predetermined period and paid at monthly intervals until the debt is completely paid off is known as a monthly payment.
On a loan of $55,000, a total interest at the given rate over 5 years will lead to an amount of $63,798.25. This amount in monthly payments will be done as below,
[tex]\rm Monthly\ Payment\ = \dfrac{Amount}{No.\ of\ Months}\\\\\rm Monthly\ Payment\ = \dfrac{63798.25}{60}\\\\\rm Monthly\ Payment\ = \$1063.30[/tex]
Hence, the monthly payment to be made is calculated as above.
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