What amortization payment would you need to make every month, at $$ 12 \% $$ interest compounded monthly, to pay off a loan of $$ \$ 8,500 $$ in 3 years? (Use Table 12-2.) Select one: a. $$ \$ 3,538.97 $$ b. $$ \$ 282,32 $$ e. $$ \$ 197.32 $$ d. $$ \$ 279.53 $$

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We start with the annuity payment formula

$$
\text{Payment} = \frac{rL}{1-(1+r)^{-n}},
$$

where  
$$ L = 8500 $$ is the loan amount,  
$$ r = \frac{0.12}{12} = 0.01 $$ is the monthly interest rate, and  
$$ n = 3 \times 12 = 36 $$ is the total number of payments.

Substitute the values into the formula:

$$
\text{Payment} = \frac{0.01 \times 8500}{1 - \left(1.01\right)^{-36}}.
$$

First, calculate the numerator:

$$
0.01 \times 8500 = 85.
$$

Next, compute $$\left(1.01\right)^{-36}$$. We know

$$
\left(1.01\right)^{36} \approx 1.4308,
$$

so

$$
\left(1.01\right)^{-36} \approx \frac{1}{1.4308} \approx 0.6993.
$$

Now, the denominator is

$$
1 - 0.6993 = 0.3007.
$$

Thus, the payment is

$$
\text{Payment} \approx \frac{85}{0.3007} \approx 282.53.
$$

The closest answer among the choices is

$$
\text{\$282.32}.
$$

Therefore, the correct answer is option b.
The monthly amortization payment is approximately \$282.32.

What amortization payment would you need to make every month, at \( 12 \% \) interest compounded monthly, to pay off a loan of \( \$ 8,500 \) in 3 years? (Use Table 12-2.) Select one: a. \( \$ 3,538.97 \) b. \( \$ 282,32 \) e. \( \$ 197.32 \) d. \( \$ 279.53 \)

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