Answer:
The payment would be $ 897.32.
Step-by-step explanation:
Since, the monthly payment of a loan is,
[tex]P=\frac{PV(r)}{1-(1+r)^{-n}}[/tex]
Where, PV is the present value of the loan,
r is the monthly rate,
n is the total number of months,
Here,
PV = $170,000,
Annual rate = 4 % = 0.04
So, the monthly rate, r = [tex]\frac{0.04}{12}=\frac{1}{300}[/tex] ( 1 year = 12 months )
Time in years = 25,
So, the number of months, n = 12 × 25 = 300
Hence, the monthly payment of the debt would be,
[tex]P=\frac{170000(\frac{1}{300})}{1-(1+\frac{1}{300})^{-300}}[/tex]
[tex]=897.322628506[/tex]
[tex]\approx \$ 897.32[/tex]
