Question

find the final monthly payment required to pay off a loan with a $1400 remaining principal and 18% annual interest rate. $? round to the nearest cent.

Explanation:

Step1: Determine monthly interest rate

The annual interest rate is 18%, so the monthly interest rate \( r \) is \( \frac{0.18}{12} = 0.015 \).

Step2: Calculate monthly payment (assuming one - month payoff)

If we assume the loan is paid off in one month, the monthly payment \( M \) should cover the principal and the interest for one month. The formula for the payment when paying off a loan in one period (month here) is \( M = P(1 + r) \), where \( P=\$1400 \) and \( r = 0.015 \).
So \( M=1400\times(1 + 0.015)=1400\times1.015 = 1421.00 \)

Answer:

\(\$1421.00\)