Answered: 21. You borrowed 75 percent of a new… | bartleby

Corporate Fin Focused Approach

Corporate Fin Focused Approach

5th Edition

ISBN:9781285660516

Author:EHRHARDT

Publisher:EHRHARDT

Chapter4: Time Value Of Money

Section4.17: Amortized Loans

Problem 1ST

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Question

21. You borrowed 75 percent of a new car priced at $20,000 with an interest rate of 7 percent
interest for 6 years. What is the amount of your monthly payment? What should be the formula
on cell B4 to find the amount of your monthly payment?
A
1 Price
2 Interest Rate
3 Years
B
$20,000
7%
6
4 Monthly Payment =PV
5
D
PV(rate, nper, pmt, [fv], [type])
a. =PMT(B2*12,B3/12,-0.75*B1,0)
b. =PMT(B2,B3,-B1,0)
c. =PMT(B2/12,B3*12,-0.75*B1,0)
d. =PMT(B2/12,B3*12,-B1,0)
e. =PMT(B2/12, B3/12,-0.75*B1,0)

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