Troy juth wants to purchase new dive equipment for underwater connection, his retail store in colorado springs. he was offered a $45,000 loan at 3% for 60 months. what is his monthly payment by formula? (round your answer to the nearest cent.)

PMT = r (PV) / 1 - (1+r) ^{-n}

r=rate =.03/12

PV = Previous Value = 45,000

n=number of months = 60

Payment is $808.59

The monthly payment is $808.59 to the nearest cent.

Explanation:

The payment can be calculated using the formula:

P = iA / [1 - (1+i) ^-N]

Where:

P = The monthly payment

i = The interest rate per period i. e. per month

A = The loan amount

N = Total number of payments for life of the loan

P = iA / [1 - (1+i) ^-N]

i = 3%/12 = 0.0025

A = $45,000

N = 60 months

P = 0.0025*45000 / [1 - 1.0025^-60]

P = 112.5 / [1 - 0.8608691058]

P = 112.5 / 0.1391308942

P = 808.59108 → $808.59 is the monthly payment