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Mr. and Mrs. Wallace have decided to buy a car for [tex] \$21,600 [/tex]. They will finance [tex] \$15,000 [/tex] of it with a 5-year auto loan at [tex] 2.9\% [/tex] APR.

What will their monthly payment be?

Monthly Car Loan Payment Per [tex] \[tex]$1000 [/tex] Borrowed

\begin{tabular}{|c|c|c|c|c|}
\cline { 2 - 5 } \multicolumn{1}{c|}{} & \multicolumn{4}{|c|}{ Term (months) } \\
\hline Rate & 24 & 36 & 48 & 60 \\
\hline $[/tex]2.5 \%[tex]$ & 42.760 & 28.861 & 21.914 & 17.747 \\
\hline $[/tex]2.6 \%[tex]$ & 42.805 & 28.905 & 21.958 & 17.791 \\
\hline $[/tex]2.7 \%[tex]$ & 42.849 & 28.949 & 22.002 & 17.836 \\
\hline $[/tex]2.8 \%[tex]$ & 42.893 & 28.993 & 22.046 & 17.880 \\
\hline $[/tex]2.9 \%[tex]$ & 42.937 & 29.037 & 22.090 & 17.924 \\
\hline $[/tex]3.0 \%$ & 42.981 & 29.081 & 22.134 & 17.969 \\
\hline
\end{tabular}



Answer :

GinnyAnswer
To determine Mr. and Mrs. Wallace's monthly payment for a car loan of [tex]$15,000 over a term of 60 months with an annual percentage rate (APR) of 2.9%, we follow these steps: 1. Identify the necessary values from the problem: - Loan amount: $[/tex]15,000
- Loan term: 60 months
- APR: 2.9%

2. Find the monthly payment rate per [tex]$1,000 financed for a 60-month term at 2.9% APR from the provided table: - From the table, we see that the monthly payment per $[/tex]1,000 for a 60-month loan at 2.9% is [tex]$17.924. 3. Calculate the monthly payment: - Since the payment per $[/tex]1,000 is known, we can calculate the monthly payment for the entire loan by multiplying this rate by the number of [tex]$1,000 increments in the loan amount: - Monthly Payment = (Loan Amount / 1,000) Monthly Payment per $[/tex]1,000
- Monthly Payment = ([tex]$15,000 / 1,000) 17.924 4. Perform the multiplication: - Monthly Payment = 15 * 17.924 - Monthly Payment = 268.86 Therefore, Mr. and Mrs. Wallace's monthly car loan payment will be $[/tex]268.86.

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