You borrowed $5000 from your parents to purchase a used car. The arrangements of the loan are such that you will make payments of $250 per month pus 1% interest on the unpaid balance.

1) Find the first year's monthly payments you will make, and the unpaid balance after each month.
2) Find the total amount of interest paid over the term of the loan.

Thanks for the help.

edit* May I know the equation or how you get the equation?

Question

You borrowed $5000 from your parents to purchase a used car. The arrangements of the loan are such that you will make payments of $250 per month pus 1% interest on the unpaid balance.

1) Find the first year's monthly payments you will make, and the unpaid balance after each month. 
2) Find the total amount of interest paid over the term of the loan.

Thanks for the help.

edit* May I know the equation or how you get the equation?

nurali · Answer

Welcome to Openstudy.

anonymous · Answer

Thanks! I'm a little confused about how to make the equation though. ._.

wolf1728 · Answer

Wow - too bad it's so late- I'll be gone after this posting Here are the formulas solved for Monthly Payment http://1728.org/loanform.htm Principal http://1728.org/loanfrm2.htm Years http://1728.org/loanfrm3.htm Also check other pages for calculators for loans.