I don't think using geometric sequences here is appropriate, as you are paying money on the amount owing, instead of interest just accumulating on what is owed. This is actually an annuity. I suggest looking up the annuities formula.
Charles borrows $6000 for a new car.Compound intrest is charged on the loan at at a rate of 2% per month.Charles has to pay off the loan with 24 equal monthly payments.Calculate the value of each monthly payment.
Any help is appreciiated the answer in text is 317.226
I don't think using geometric sequences here is appropriate, as you are paying money on the amount owing, instead of interest just accumulating on what is owed. This is actually an annuity. I suggest looking up the annuities formula.
Hello, spacemenon!
Are you expected to solve this with Geometric Sequences?
That is an awesomely involved problem.
Charles borrows $6000 for a new car.
Compound intrest is charged on the loan at at a rate of 2% per month.
Charles has to pay off the loan with 24 equal monthly payments.
Calculate the value of each monthly payment.
Textbook answer: 317.226 . ??
That is a strange answer.
First of all, it should be rounded to the nearest cent.
Second, it is inaccurate.
This is an Amortization problem.
Formula: .
. . where: .
We have: .
Hence: .
Therefore: .