interest rates?

Question

price of car 13,999
manufacturer's rebate 1000
down payment 3000
amount to finance 9,999
interest rate 8%
term (years) 4


how do i find the monthly payment? i know that the answer is 244.1 but how to you come to that?

Answer 1

Monthly payment = [rate + rate/(((1 + rate)^months) -1)] * principal

Where rate = monthly interest rate = Annual interest rate / 1200 (example: 8% / 100 to get .08, then .08/12 to get the monthly interest rate)
rate = 8/1200 = 0.006667
months = 4 years * 12 mo/year = 48 mo.

payment = [0.006667 + 0.006667/(((1.006667)^48) -1)] * $9999
payment = [0.006667 + 0.006667/0.375688)] * $9999
payment = [0.006667 + 0.017746] * $9999
payment = 0.024413 * $9999
payment = $244.11