Car Loan Costs: Car 4,500,000 Down Payment 1,000,000 APR

Question

Car Loaninputscost Of Car 4500000down Payment 1000000apr Remove the repetitive and extraneous data. The core assignment is: Calculate the monthly payment, total repayment, and interest paid on a car loan given the car's cost, down payment, annual percentage rate (APR), and loan term. Given the following inputs: Cost of Car: $4,500,000 Down Payment: $1,000,000 APR: 3.99% Loan Term: 5 years Payments Per Year: 12 Calculate the monthly loan payment, total amount to be repaid, and total interest paid over the life of the loan.

Dr. Jack HW Helper · Accepted Answer

The process of calculating a car loan’s monthly payment, total repayment, and total interest involves understanding the fundamental concepts of amortized loan formulas. In this case, the inputs provided include the total cost of the car, the down payment, the annual percentage rate (APR), and the loan term expressed in years. These parameters allow us to determine the monthly payment and overall costs associated with the loan, which are critical for financial planning and decision-making. Introduction Car loans are common financial instruments used by consumers to finance vehicle purchases. They typically involve paying a set amount monthly over a specified period, with interest charges incorporated into each payment. Understanding how to compute these payments provides borrowers with clarity on their financial obligations and helps in comparing loan options. The primary components influencing such calculations include principal amount, interest rate, loan term, and payment frequency. Calculating the Loan Details The first step involves determining the loan's principal, which is the amount borrowed after the down payment is subtracted from the total car cost. In this scenario: Principal = Cost of Car - Down Payment = $4,500,000 - $1,000,000 = $3,500,000 The annual interest rate (APR) is 3.99%. To facilitate calculations, it must be converted into a monthly interest rate: Monthly Interest Rate = APR / 12 = 3.99% / 12 ≈ 0.003325 or 0.3325% The total number of payments over the loan's life is determined by multiplying the loan term in years by the number of payments per year: Total Payments = Years × Payments per Year = 5 × 12 = 60 The monthly payment can be derived using the standard amortization formula: Monthly Payment = P × r(1 + r)^n / [(1 + r)^n - 1] where: P = principal loan amount = $3,500,000 r = monthly interest rate = 0.003325 n = total number of payments = 60 Substituting the values: Monthly Payment = 3,500,000 × 0.003325 × (1 + 0.003325)^60 / [(1 + 0.00332

Car Loan Costs: Car 4,500,000 Down Payment 1,000,000 APR

Car Loaninputscost Of Car 4500000down Payment 1000000apr

Sample Paper For Above instruction

Introduction

Calculating the Loan Details

Conclusion

References