Question

find the final monthly payment required to pay off a loan with $900 remaining principal and a 12% annual interest rate. $? round to the nearest cent.

Explanation:

Step1: Determine monthly interest rate

The annual interest rate is 12%, so the monthly interest rate \( r \) is \( \frac{12\%}{12} = 1\% = 0.01 \).

Step2: Calculate monthly payment

Assuming this is a one - month loan (since we are finding the final monthly payment to pay off the loan, implying the loan is due in one month), the monthly payment \( M \) is the principal plus the interest on the principal. The formula for simple interest is \( I = P\times r \), where \( P=\$900 \) and \( r = 0.01 \). So the interest \( I=900\times0.01 = 9 \). Then the monthly payment \( M=P + I=900 + 9=\$909.00 \). (If we assume it's a different loan term, but since no term is given, the most reasonable assumption for a final monthly payment to pay off the loan is a one - month term, as we are to pay off the loan in one month with interest.)

Answer:

\( \$909.00 \)