If you borrow $17,000 with a loan for 11 years, with 8.75% monthly compounded interest, how much would your monthly payments be?

To calculate the monthly payment for a loan with compounded interest, we use the **amortization formula**:

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

Where:
- $ M $ = monthly payment
- $ P $ = loan amount = 17,000
- $ r $ = monthly interest rate (annual rate / 12) = 8.75% / 12
- $ n $ = total number of payments (loan term in months) = 11 years × 12

Let's calculate the monthly payment step by step. 

1. Convert the annual interest rate into a monthly rate:  
   $ r = \frac{8.75\%}{12} = \frac{0.0875}{12} $
   
2. Calculate the total number of payments:  
   $ n = 11 \times 12 = 132 $ months

Now, I'll calculate the monthly payment.The monthly payment for the loan would be approximately **$201.00**.

Would you like a breakdown of the calculations or more details on how loans work?

Here are 5 related questions for further exploration:
1. What would happen if the interest rate were compounded quarterly instead of monthly?
2. How would the payment change if the loan term were extended to 15 years?
3. What is the total amount paid over the life of the loan, including interest?
4. How much interest will you have paid by the end of the loan term?
5. What impact does making extra payments have on reducing the loan term?

**Tip:** Always check if the interest is compounded monthly, quarterly, or annually, as this affects the final payment.

Find out how to calculate the monthly payments on a $17,000 loan over 11 years with 8.75% monthly compounded interest. This example explains the amortization formula step-by-step, including converting the annual interest rate into monthly terms and calculating the total loan term in months.

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