Given a note for $1,000, with 24 equal monthly payments, and a 7.5% true annual interest rate is charged. What is the principal plus interest payment?

Use the formula of the present value of an annuity ordinary which is

Pv=pmt [ (1 - (1+r/k) ^ (-n)) : (r/k) ]

Pv present value 1000

PMT principal plus interest payment?

R interest rate 0.075

K 12 months because the payment is monthly

N number of payments 24

Solve the formula for PMT

PMT=pv:[ (1 - (1+r/k) ^ (-n)) : (r/k) ]

PMT=1,000: ((1 - (1+0.075:12) ^ (

-24)) : (0.075:12))

=44.99 round your answer to get 45