Let's break down each part of Lavonda's loan to find the correct answers.

Given:

• Loan amount (Principal) = $7,500
• Annual Percentage Rate (APR) = 6.875% or 0.06875
• Loan term = 6 years
• Monthly payments

First, we'll calculate the correct monthly payment using the formula for a fixed-rate loan:

$M = \frac{P \cdot r \cdot (1 + r)^n}{(1 + r)^n - 1}$

Where:

• $M$ = monthly payment
• $P$ = loan principal = $7,500
• $r$ = monthly interest rate = $\frac{0.06875}{12}$
• $n$ = total number of payments = $6 \times 12 = 72$

Now, let's compute the monthly payment.

The correct monthly payment is approximately $127.42.

Now, let's calculate the sum of all the monthly payments:

$\text{Total payments} = M \times n$

Next, I'll compute the total amount paid.The total sum of all the monthly payments is approximately $9,174.09.

Finally, let's calculate the total interest paid:

$\text{Total interest} = \text{Total payments} - \text{Loan principal}$ I'll calculate the total interest now.The total interest paid over the course of the loan is approximately $1,674.09.

Summary:

1. Number of monthly payments: 72
2. Monthly payment: $127.42
3. Sum of all monthly payments: $9,174.09
4. Total interest paid: $1,674.09

Would you like further details or explanations on any of these calculations?

Here are 5 related questions to consider:

1. How would the monthly payment change if the APR was higher or lower?
2. How much interest would be paid if the loan term was only 3 years?
3. What happens to the monthly payment if Lavonda made extra payments each month?
4. How does a 15-year mortgage compare to a 6-year loan in terms of total interest paid?
5. What is the impact of refinancing this loan to a lower APR halfway through?

Tip: Always review the total interest paid on a loan before agreeing to the terms, as it can significantly increase the cost of the loan over time!