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Banks provide an annual rate, but since Maya pays every month, she needs the . Formula : Calculation : , which is 0.0050.005 as a decimal. Step 3: Apply the Amortization Formula To find the exact monthly payment ( ), Maya uses the standard loan formula:

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Maya had finally saved up for her dream commuter car, a reliable pre-owned sedan priced at . She had $4,000 in her savings account for a down payment, but she needed a loan for the rest. After visiting her local credit union, she was approved for a 5-year (60-month) loan at an annual interest rate (APR) of 6% . Banks provide an annual rate, but since Maya

). By subtracting her original $18,000 loan, she realizes she is paying to the bank for the privilege of borrowing the money. ✅ Answer For financial advice, consult a professional

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Over the course of 5 years, she will pay a total of (