The following loan is a simple interest amortized loan with monthly payments. (Round your answers to the nearest cent.)
$4000, 9 1/2%, 4 years

To calculate the monthly payments for a simple interest amortized loan, we use the following steps:

### Given:
- Loan amount ($ P $) = $4000
- Annual interest rate ($ r $) = 9.5% = 0.095
- Loan term ($ t $) = 4 years
- Payments are made monthly.

### Steps:
1. **Convert the annual interest rate to a monthly interest rate**:
   \[
   r_{\text{monthly}} = \frac{r}{12} = \frac{0.095}{12} = 0.00791667 \, \text{(monthly interest rate)}
   \]

2. **Convert the loan term to the number of monthly payments**:
   \[
   n = 4 \, \text{years} \times 12 \, \text{months/year} = 48 \, \text{months}
   \]

3. **Use the amortized loan formula to calculate the monthly payment**:
   The formula for an amortized loan is:
   \[
   M = \frac{P \cdot r_{\text{monthly}}}{1 - (1 + r_{\text{monthly}})^{-n}}
   \]
   Where:
   - $ M $ is the monthly payment.
   - $ P $ is the loan amount.
   - $ r_{\text{monthly}} $ is the monthly interest rate.
   - $ n $ is the number of monthly payments.

Now let's calculate the monthly payment.The monthly payment for the loan is approximately **$100.49**.

Would you like any further details or have any other questions?

Here are five related questions to explore:

1. How much total interest will be paid over the course of the loan?
2. What would the monthly payment be if the interest rate increased to 12%?
3. How does an amortized loan differ from a simple interest loan?
4. What is the effect of extending the loan term to 5 years on the monthly payment?
5. What would happen to the monthly payments if a lump sum payment is made halfway through?

**Tip**: Lowering the interest rate or extending the loan term can reduce monthly payments but may increase the total interest paid over the loan term.

The following loan is a simple interest amortized loan with monthly payments. (Round your answers to the nearest cent.) $4000, 9 1/2%, 4 years.

Learn how to calculate the monthly payments for a $4000 amortized loan at 9.5% over 4 years. This step-by-step guide covers concepts such as simple interest, monthly payments, and the amortized loan formula. Perfect for high school students studying financial math.

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