Car Loan Calculation: How Much Will Be Outstanding After Next Payment?

With a car loan of $15,650 outstanding and monthly payments at 8% APR, if the monthly payment is $701.30, what will be outstanding on the loan after the next payment?

Choose the correct answer:

A. $15,053.03

B. $15,350.67

C. $14,826.40

Answer: $15,053.03

Great news! If you're curious about how much will be outstanding on your car loan after the next payment, the answer is $15,053.03. Let's break it down:

Since your car loan has an 8% APR with monthly payments, we need to calculate the outstanding amount after the next payment:

Loan Amount: $15,650

Monthly APR: 8%

Monthly Payment: $701.30

To calculate the loan after the next payment, we need to consider the increase in the cost per month due to the APR. Here's how it's done:

Loan after next payment = $15,650 x (1 + 0.00666667) - $701.30

Loan after next payment = $15,053.03

Therefore, after your next monthly payment, the outstanding amount on the car loan will be $15,053.03. Keep up with your payments and you'll soon be closer to being debt-free!