ADD ON LOAN:
Monthly payment = (4500+4500*18%*5)/60 =	$ 142.50	Answer
Total amount of interest = 4500*18%*5 =	$ 4,050.00	Answer
True interest rate:
It is the IRR of the resulting cash flows.
We have
4500 = 142.5*PVIFA(irr/12,60)
31.5790 = PVIFA(irr/12,60)
The value of irr has to be found by trial and error.
Using an online calculator
for irr/12 = 0.024, the interest factor = 31.6253
for irr/12 = 0.025, the interest factor = 30.9087
The exact value of irr/12 = 0.024+0.001*(31.6253-31.5780)/(31.6253-30.9087) =	2.41%
IRR = 0.024066*12 =	28.88%	Answer
COMPOUND INTEREST LOAN:
Using the fomula for loan amortization
Monthly payment = 4500*(0.18/12)*(1+0.18/12)^60/((1+0.18/12)^60-1)) =	$ 114.27	Answer

ADD ON LOAN:
Monthly payment = (4500+4500*18%*5)/60 =	$ 142.50	Answer
Total amount of interest = 4500*18%*5 =	$ 4,050.00	Answer
True interest rate:
It is the IRR of the resulting cash flows.
We have
4500 = 142.5*PVIFA(irr/12,60)
31.5790 = PVIFA(irr/12,60)
The value of irr has to be found by trial and error.
Using an online calculator
for irr/12 = 0.024, the interest factor = 31.6253
for irr/12 = 0.025, the interest factor = 30.9087
The exact value of irr/12 = 0.024+0.001*(31.6253-31.5780)/(31.6253-30.9087) =	2.41%
IRR = 0.024066*12 =	28.88%	Answer
COMPOUND INTEREST LOAN:
Using the fomula for loan amortization
Monthly payment = 4500*(0.18/12)*(1+0.18/12)^60/((1+0.18/12)^60-1)) =	$ 114.27	Answer

Suppose that you are only allowed to make a balloon payment to the principal of the compound interest loan. You have $1,000 to put down at the beginning of year 3. How many payments will you save?