$$m=\dfrac{\Big( \dfrac{r}{1200} \Big) \Big( 1+\dfrac{r}{1200} \Big) ^N}{\Big( \dfrac{r}{1200} \Big) ^N-1} P$$
The formula above gives the monthly payment $$m$$ needed to pay off a loan of $$P$$ dollars at $$r$$ percent annual interest over N months. Which of the following gives P in terms of $$m, r$$, and $$N$$?

Question

$$m=\dfrac{\Big(  \dfrac{r}{1200}  \Big)  \Big(  1+\dfrac{r}{1200}  \Big)  ^N}{\Big(    \dfrac{r}{1200}  \Big)  ^N-1}  P$$
The formula above gives the monthly payment $$m$$ needed to pay off a loan of $$P$$ dollars at $$r$$ percent annual interest over N months. Which of the following gives P in terms of $$m, r$$, and $$N$$?

Uniteasy Admin · Accepted Answer

Express P in terms of $$m, r$$, and $$N$$
Just multiply both sides of the equation $$m=\dfrac{\Big(  \dfrac{r}{1200}  \Big)  \Big(  1+\dfrac{r}{1200}  \Big)  ^N}{\Big(    \dfrac{r}{1200}  \Big)  ^N-1}  P$$ by  $$\dfrac{\Big(    \dfrac{r}{1200}  \Big)  ^N-1}{\Big(  \dfrac{r}{1200}  \Big)  \Big(  1+\dfrac{r}{1200}  \Big)  ^N}$$

Choice B is correct.

Multiple Choice Question (MCQ)

Answer