Suppose that you took out a loan with a principal of $24,680. To pay off the principal and the interest, you made quarterly payments of $1,382 for six years. Furthermore, you paid a service charge of $396. What was your total finance charge?

Question

mathmale · Answer

I'm sure there are online references that include the formulas that apply to such problems.  Do you have such a formula in mind?  If not, please do an Internet search and look for a relevant formula or two.  I know as a fact that there's a formula for calculating the monthly payment when P, the interest rate, the number of payments per year and the number of years are all given.  Here, in your posted problem, the situation is different:  you already know the monthly payment, the number of years, the fact that compounding occurs every 3 months, but you do not know the amount of interest you'll pay on this loan.  

When you've done some research on this and have some possible formulas in mind. come back...we'll resume this discussion.