Luella took out an unsubsidized student loan of $37,000 at a 4.8% APR,

compounded monthly, to pay for her last six semesters of college. If she will

begin paying off the loan in 33 months with monthly payments lasting for 20

years, what will be the amount of her monthly payment?

The correct answer is : $273.92 APEX

Answer: $272

Step-by-step explanation:

Her amount due = 37,000 (1.004) ^273

If her monthly payment is x

She'll pay = x (1.004) ^240 + x (1.004) ^239 + ... x (1.004) ^1 + x

= x[ (1.004) ^241 - 1] / (1.004-1) =

Her payment = Amount due

so

x[ (1.004) ^241 - 1] / (1.004-1) = 37000 (1.004) ^273

404x = 37000 (1.004) ^273 = 110029

x = 110029/404 = $272

Monthly payment = $272