You wish to buy a $11,000 dining room set. The furniture store offers you a 3-ye

Question

You wish to buy a $11,000 dining room set. The furniture store offers you a 3-year loan with an 12 percent APR. What are the monthly payments? (Do not round intermediate calculations and round your final answer to 2 decimal places.)

How would the payment differ if you paid interest only? (Do not round intermediate calculations and round your final answer to 2 decimal places.)

You wish to buy a $11,000 dining room set. The furniture store offers you a 3-year loan with an 12 percent APR. What are the monthly payments? (Do not round intermediate calculations and round your final answer to 2 decimal places.)

Explanation / Answer

Let monthly payments be x

present value of monthly payments = $11000

11000 = x/(1+12%) + x/(1+12%)^2 + x/(1+12%)^3.....x/(1+12%)^36

Monthly payments, x= $365.36

How would the payment differ if you paid interest only?

Interest = 1%*11000 = $110

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