Hi, I need help about how to calculate loan payments. Can someone show the process of calculating these types of questions?
Suppose I borrow x dollars for y months. The monthly interest rate is z%. I don't start paying until the end of the y months.
1. How do I calculate the total amount I owe at the end of the y months?
2. If I start paying the loan over the next c years, how do I calculate the monthly payment?
let "the total amount I owe at the end of the y months" = A
Each month, the z% of x is added to x
z% of x = (zx)/100
So A = x + (z% of x)*y
u will add z% of x, y times to x to give A
I either cannot answer Q2 or not understand it.
If i know what you mean,
you will start paying when y=(c/12)+12 months have passed
we know that A = x + (z% of x)*((c/12)+12 ) when y=(c/12)+12
so Q2's answer will be A/y (Wondering)
Why are you complicating something simple?
Originally Posted by RU091
Loan of $x for y months at monthly rate of z% : calculate monthly payment P
i = z/100
P = xi / [1 - 1/(1+i)^y]