Katelyn plans to apply for a $10,000 loan at an interest rate of 5.6% for 5 years. Use the monthly payment formula to complete the statement.

P (1) (1 + 5) 121

M = (1 + 5) 12² - 1

M = monthly payment

P = principal

r = interest rate

t = number of years

Rounded to the nearest cent, Katelyn's monthly payment for the loan is $

Katelyn's monthly payment for the loan is $ 2,032.52

Step-by-step explanation:

The formula given is explicit, we can solve for monthly payment using the below formula

P=L (1-r/r-r^n+1)

r=1 / (1+i)

i=5.6%/12=0.47%

5.6% is an annual interest rate, it would be appropriate to restate in monthly terms

r=1 / (1+0.47%) = 0.995

n=5 years*12 months=60

L is the loan amount of $100,000

P=100000 * (1-0.995) / (0.995-0.995^60+1)

=100000 * (1-0.995) / (0.995-0.74)

=100000*0.005/0.246

=$ 2,032.52