

Adelaide wants to buy a new refrigerator. The refrigerator costs $1500
. Adelaide decides to finance the refrigerator for 24 months at an APR of 12.5%. Determine Adelaide's monthly payment. Round your answer to the nearest cent, if necessary.

To determine Adelaide's monthly payment for the refrigerator, we can use the formula for the monthly payment of a loan, which is given by:

\[
M = \dfrac{P \cdot r \cdot (1 + r)^n}{(1 + r)^n - 1}
\]

Where:
- $ M $ = monthly payment
- $ P $ = principal amount (the cost of the refrigerator), which is $1500
- $ r $ = monthly interest rate (annual interest rate divided by 12)
- $ n $ = total number of payments (loan term in months)

### Step 1: Identify values
- Principal, $ P = 1500 $
- Annual interest rate (APR) = 12.5%, so the monthly interest rate is:
  \[
  r = \dfrac{12.5\%}{12} = \dfrac{0.125}{12} = 0.0104167
  \]
- Number of payments, $ n = 24 $ months

### Step 2: Plug values into the formula

\[
M = \dfrac{1500 \times 0.0104167 \times (1 + 0.0104167)^{24}}{(1 + 0.0104167)^{24} - 1}
\]

I'll calculate the monthly payment now.Adelaide's monthly payment for the refrigerator will be approximately **$70.96**.

Would you like further details or clarifications on this calculation?

Here are five related questions you might explore:
1. How much will Adelaide have paid in total over the 24 months?
2. What portion of the total payment goes toward interest?
3. How would the monthly payment change if the loan term were 36 months instead of 24?
4. What if the APR was 10% instead of 12.5%? How would that affect the monthly payment?
5. How is the amortization schedule of the loan calculated?

**Tip:** The longer the loan term, the lower the monthly payments, but the more you pay in total interest!

Adelaide wants to buy a new refrigerator. The refrigerator costs $1500. Adelaide decides to finance the refrigerator for 24 months at an APR of 12.5%. Determine Adelaide's monthly payment. Round your answer to the nearest cent, if necessary.

Learn how to calculate the monthly payment for Adelaide's $1500 refrigerator, financed over 24 months at 12.5% APR. This problem covers essential finance math concepts such as loan payment calculation, interest rates, and amortization schedules.

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