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Question - A recent college graduate buys a new car by borrowing $22,000 at 7.2%, compounded monthly, for 4 years. She decides to pay $539 instead of the monthly payment required by the loan.
Required -
a. What is the monthly payment required by the loan? How much extra did she pay per month?
b. How many $539 payments will she make to pay off the loan?
c. How does she pay in total over the life of the by paying $539 per month rather than the required payment?
If instead of paying $539 per month she only paid the required payment every month, how much would she have paid in total over the life of the loan?
How much will she save by paying $539 per month rather than the required payment?
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