$168.06
Explanation:
Price tag = $5000
Principal = 5000
rate = 7% = 0.07
time = 3 years
Using the simple interest formula:
[tex]\begin{gathered} I\text{ = PRT} \\ I\text{ =interest} \\ I\text{ = 5000 }\times\text{ 0.07 }\times\text{ 3} \\ I\text{ = \$}1050 \end{gathered}[/tex][tex]\begin{gathered} FV\text{ = I + P} \\ FV=\text{futue value} \\ FV\text{ = 5000 + 1050} \\ FV\text{ = \$6050} \end{gathered}[/tex]
The monthly payment:
[tex]\begin{gathered} 12\text{ months = 1 year} \\ nu\text{mber of months in 3 years = }3(12)\text{ = 36 months} \\ \text{monthly payment = }\frac{future\text{ value}}{nu\text{mber of months}} \end{gathered}[/tex][tex]\begin{gathered} \text{monthly payment = }\frac{6050}{36} \\ monthly\text{ payment = 168.0556} \\ To\text{ the nearest hundredth, the monthly payment is \$168.06} \end{gathered}[/tex]
