Suppose that under the Plan of Repayment one should pay off the debt in a number of equal end-of-month installments (principal and interest). This is the customary way to pay off loans on automobiles, house mortgages, etc. A friend of yours has financed

$24,000 on the purchase of a new automobile, and the annual interest rate is 6% (0.5 %per month).

a. Monthly payments over a 60 -month loan period will be how much?

b. How much interest and principal will be paid within three month of this loan?