Math Problem Statement

You can afford a $300 per month car payment. You've found a 4 year loan at 5% interest. How big of a loan can you afford?

Solution

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Math Problem Analysis

Mathematical Concepts

Annuities
Present Value
Interest Rates

Formulas

Present Value of an Ordinary Annuity: PV = P × (1 - (1 + r)^(-n)) / r

Theorems

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Suitable Grade Level

Grades 10-12