1.Your auto insurance premium of $2200 is due today. You insurance company is giving you the easy...

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Question:

1.Your auto insurance premium of $2200 is due today. You insurance company is giving you the "easy financing" option of making 12 monthly payments, with the 1st payment starting today. The interest rate on this financing option is 17.00% with monthly compounding. What's the monthly payment amount?

Final answer would be 197.85.

2.A young couple decide to take advantage the current first-time home buyer credit and buy a new house. With their combined income, they can afford to make a maximum of $850 monthly payment. With their credit history, they can borrow a 30-year fixed rate mortgage loan at 6.7% (mortgage loans compound monthly). What's the maximum amount they can borrow?

Hint for Q2: Final answer would be 131726.18

Please note that I tried to use excel in order to find the payment for Q1 and I got 200.65