Answer:
The full question is as follows:
Molly noticed a deal on the Jeep website and wants to figure out her monthly payments... If Molly has saved a down payment of $2500 for this purchase, on the assumption that the $1500 Cash Allowance applies... Utilize the loan calculator to find out what Molly's monthly payment will be?
It's important to note that the cash price as displayed in the attachment is $25,495
Repayment is for a duration of 84 months
Molly's monthly payment amounts to $273.49
Explanation:
The financing amount is the car price minus the cash allowance and the down payment.
The financing total is $25,495 - $1,500 - $2,500 = $21,495.00
To find the monthly payment, the Excel PMT formula applies
=pmt(rate,nper,-pv,fv)
Rate is calculated per month, which is 1.9%/12 = 0.001583333
nper is 84 months
pv refers to the financing amount which is $21,495.00
fv is the total repayment amount, which remains unknown
=pmt(0.001583333
,84,-21,495,0)=$273.49