Can someone tell me if I'm using the right formula to solve this problem? Using a financial calculator i know the answer is $1529 but I'm trying to figure out how to solve manually.
You want to buy a new sports coupe for $79,500, and the finance office at the dealership has quoted you an APR of 5.8 percent for a 60-month loan to buy the car. What will your monthly payments be? What is the effective annual rate on this loan?
Monthly Payment = rate per period(PV) / 1-(1+rate per period)^-number of periods
= (.058($79,500)) / (1-(1+.058)^-60)