Jeffrey K. answered • 08/31/20

Together, we build an iron base in mathematics and physics

Here's how to do this:

First, note that the __monthl__y interest rate is i = 1%.

At the end of 3 years, the outstanding balance is the difference between the amount borrowed and the present value (PV) of the first 36 payments = 20,000 - 400 [1/(1 + i) + 1/(1 + i)^{2} + . . . 1/(1 + i)^{36}]

= 20,000 - (400 / 1.01) ( 1 - 1/1.01^{36}) / (1 - 1/1.01 )

I leave you to do the arithmetic! (Note that the total number of payments, n, and the final payment, P, are not needed.)