Homework Question Help Needed

Business & Finance
Tutor: None Selected Time limit: 1 Day

You are considering the purchase of a BMW, You will borrow the money from the BMW Financial Services and here are there terms: MSRP $80,000/ Term 24 months/ APR 7.5%/ Down payment $0/ $3599.97 Monthly payment. The amortized loan payments are a blend of interest and principal. What is the total amount of interest you would pay over life of loan? (ROUND TO NEAREST DOLLAR)

Jun 25th, 2015

Thank you for the opportunity to help you with your question!

  • Annual Payment = P / [ ( 1 - (1/(1+i)^n) ) / i ]
  • "P" represents the principal amount; "i" represents the interest rate; and "n" represents the length of the loan in years.
80000/{(1-1/(1+0.075)^2)})/0.075

80000/[1-(1/1.156))0.075

80000/(1-0.865)/0.075

80000/(0.135/0.075)

80000/1.8=44,444.44

44444$


Please let me know if you need any clarification. I'm always happy to answer your questions.
Jun 25th, 2015

this answer is incorrect

Jun 25th, 2015

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