Help with pre calc

Question

Jing borrowed $22 000 for a second-hand vehicle. She pays $450 per month for 6 years on a monthly basis. What is the monthly compound interest rate on this loan?

Answer 1

the underlying formula that you want to use to solve this one is

PV = PMT*[1 - (1+i)^(-n) / i]

for this set of parameters that means taking

22000 = 450*[1 - (1 + i)^(-72) / i]

solving that using technology i get

i = 0.100% for the monthly compound interest rate on this one

Answer 2

PV = PMT[1 - (1 + i)^-nt]/i; 22000 = 450[1 - (1 + i)^-72]; 440i/9 = 1 - (1 + i)^-72.

We solve this equation, using TI-84: i = 0.011431 = 1.1431% monthly interest