the car you are interested in costs $18,000. you have saved up $2,000 for a down - payment and are looking…

Explanation:

Step1: Calculate loan amount

The car costs $18000 and the down - payment is $2000. So the loan amount $P$ is $18000 - 2000=16000$.

Step2: Calculate monthly interest rate

The annual interest rate $r = 4.5%=0.045$. The monthly interest rate $i=\frac{0.045}{12}=0.00375$.

Step3: Calculate number of payments

The loan is to be repaid over 60 months, so $n = 60$.

Step4: Use the loan - payment formula

The formula for the monthly payment $M$ of a loan is $M=\frac{P\times i\times(1 + i)^n}{(1 + i)^n-1}$. Substitute $P = 16000$, $i=0.00375$, and $n = 60$ into the formula: [ \begin{align*} M&=\frac{16000\times0.00375\times(1 + 0.00375)^{60}}{(1+ 0.00375)^{60}-1}\ &=\frac{16000\times0.00375\times(1.00375)^{60}}{(1.00375)^{60}-1} \end{align*} ] First, calculate $(1.00375)^{60}\approx1.25226$. Then, $16000\times0.00375 = 60$. The numerator is $60\times1.25226 = 75.1356$. The denominator is $1.25226-1=0.25226$. $M=\frac{75.1356}{0.25226}\approx298.29$.

Answer:

B. $298.29$