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Jordan just graduated from college and owes $13,000 on his student loans. The bank charges
an annual interest rate of 1.5%, compounded monthly. If Jordan wants to pay off his student
loans using equal monthly payments over the next 10 years, what would the monthly payment
be, to the nearest dollar?
M=
Pr(1+r)
(1+r)" 1
M=the monthly payment
P=the amount owed
T=
the interest rate per month
n = the number of payments

Respuesta :

sqdancefan

Answer:

  $116.73

Step-by-step explanation:

You want the monthly payment that will pay off a $13,000 loan at 1.5% in 10 years.

Payment

A suitable formula for the monthly payment is ...

  [tex]M=\dfrac{Pr}{1-(1+r)^{-n}}[/tex]

where r is the monthly interest rate and n is the number of months. This loan has r = 0.015/12 = 0.00125, and n = 10·12 = 120.

  [tex]M=\dfrac{13000\cdot0.00125}{1-1.00125^{-120}}\approx116.73[/tex]

Jordan's monthly payment would be $116.73.

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