You have just purchased a car and taken out a $55,000 loan. The loan has a five-

Question

You have just purchased a car and taken out a $55,000 loan. The loan has a five-year term with monthly payments and an APR of 5.7%. a. how much will you pay interest and how much will you pay principal, during the first month, second month and first year (hint: compute loan balance after one month, two months and one year) b. how much will you pay interest and how much will you pay in principal during the fourth year (i.e. between three and four years from now)?(note be careful not to round any intermediate steps less than six decimal places

Explanation / Answer

Loan Amortization Schedule Loan Information Summary Loan Amount           55,000.00 Rate (per period) 0.475% Annual Interest Rate 5.70% Number of Payments 60 Term of Loan in Years 5 Total Payments          63,338.92 First Payment Date Total Interest            8,338.92 Payment Frequency Monthly Est. Interest Savings                   0.00 Compound Period Monthly . Payment Type End of Period . Rounding On Monthly Payment           1,055.65 [42] Amortization Schedule TRUE No. Payment Interest Principal Balance 55,000.00 1 1,055.65 261.25 794.40 54,205.60 2 1,055.65 257.48 798.17 53,407.43 3 1,055.65 253.69 801.96 52,605.47 4 1,055.65 249.88 805.77 51,799.70 5 1,055.65 246.05 809.60 50,990.10 6 1,055.65 242.20 813.45 50,176.65 7 1,055.65 238.34 817.31 49,359.34 8 1,055.65 234.46 821.19 48,538.15 9 1,055.65 230.56 825.09 47,713.06 10 1,055.65 226.64 829.01 46,884.05 11 1,055.65 222.70 832.95 46,051.10 12 1,055.65 218.74 836.91 45,214.19 13 1,055.65 214.77 840.88 44,373.31 14 1,055.65 210.77 844.88 43,528.43 15 1,055.65 206.76 848.89 42,679.54 16 1,055.65 202.73 852.92 41,826.62 17 1,055.65 198.68 856.97 40,969.65 18 1,055.65 194.61 861.04 40,108.61 19 1,055.65 190.52 865.13 39,243.48 20 1,055.65 186.41 869.24 38,374.24 21 1,055.65 182.28 873.37 37,500.87 22 1,055.65 178.13 877.52 36,623.35 23 1,055.65 173.96 881.69 35,741.66 24 1,055.65 169.77 885.88 34,855.78 25 1,055.65 165.56 890.09 33,965.69 26 1,055.65 161.34 894.31 33,071.38 27 1,055.65 157.09 898.56 32,172.82 28 1,055.65 152.82 902.83 31,269.99 29 1,055.65 148.53 907.12 30,362.87 30 1,055.65 144.22 911.43 29,451.44 31 1,055.65 139.89 915.76 28,535.68 32 1,055.65 135.54 920.11 27,615.57 33 1,055.65 131.17 924.48 26,691.09 34 1,055.65 126.78 928.87 25,762.22 35 1,055.65 122.37 933.28 24,828.94 36 1,055.65 117.94 937.71 23,891.23 37 1,055.65 113.48 942.17 22,949.06 38 1,055.65 109.01 946.64 22,002.42 39 1,055.65 104.51 951.14 21,051.28 40 1,055.65 99.99 955.66 20,095.62 41 1,055.65 95.45 960.20 19,135.42 42 1,055.65 90.89 964.76 18,170.66 43 1,055.65 86.31 969.34 17,201.32 44 1,055.65 81.71 973.94 16,227.38 45 1,055.65 77.08 978.57 15,248.81 46 1,055.65 72.43 983.22 14,265.59 47 1,055.65 67.76 987.89 13,277.70 48 1,055.65 63.07 992.58 12,285.12 49 1,055.65 58.35 997.30 11,287.82 50 1,055.65 53.62 1,002.03 10,285.79 51 1,055.65 48.86 1,006.79 9,279.00 52 1,055.65 44.08 1,011.57 8,267.43 53 1,055.65 39.27 1,016.38 7,251.05 54 1,055.65 34.44 1,021.21 6,229.84 55 1,055.65 29.59 1,026.06 5,203.78 56 1,055.65 24.72 1,030.93 4,172.85 57 1,055.65 19.82 1,035.83 3,137.02 58 1,055.65 14.90 1,040.75 2,096.27 59 1,055.65 9.96 1,045.69 1,050.58 60 1,055.57 4.99 1,050.58 0.00

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