Respuesta :
An increase in the number of months that you will pay will decrease the payment because you will divide the total amount owed between a larger number which would result in a smaller amount each month.
Ex: $1000 paid in 5 months is $200/month.
$1000 paid in 10 months is $100/month.
Ex: $1000 paid in 5 months is $200/month.
$1000 paid in 10 months is $100/month.
An increase in the number of months a loan is financed decreases the monthly payment of the loan.
What is monthly payment?
Monthly payment is the payment which has to paid against the loan amount or the borrowed money calculated with interest rate.
The monthly payment is the amount which is required to pay each month to pay off the borrowed principal amount. It can be calculated with the following formula.
[tex]M=P\left(\dfrac{r}{1-(1+r)^{-nt}}\right)[/tex]
Here, (P) is the principal amount, (r) is the interest rate and (t) is time.
The monthly payment is inversely proportional to the number of months financed. Thus, an increase in the number of months a loan is financed decreases the monthly payment of the loan.
Learn more about the monthly payment here;
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