Need help about annuity question.

[Tamirci]

Question: Currently, you owe the bank TL 9.800 for a car loan. The loan has an interest rate of 7,75% per year with monthly compounding. You were making payments of TL 310 for each ending month. Your bank has recently changed such that you can no longer afford to make these TL 310 payments. After talking withyour bank officer and explaining the situation, he has agreed to lower your monthly payments to TL225 while keeping the interest rate at 7,75 % per year with monthly compounding. Determine how much longer it will take you to repay this loan than you had originally planned with this new payment schedule.

It's my homework question. I couldn't find the right answer. What can i do in that question? I've tried to ordinary annuity formula however i haven't done
I think ordinary annuity formula is correct formula for that question, what do you think?

 

[Steven G]

You asked what I think. Fair question. I think that you need to do your own problem with help from the forum helpers.

You said that you couldn't find the correct answer. Can we please see your work so that we can guide you to the solution.

Also, you need to say how long it has been that you were making the TL 310 payments for!! Or is it that after changing the monthly payments you owe TL 9.800?? Out of curiosity is TL, Turkish Lira?

 

[amathproblemthatneedsolve]

You need to calculate the difference in time between one option and another

Original Loan:

C= $310
time n
rate 0.0064583 (0.0775annual rate / 12 month per year)

PV $9,800

plug these into the equation above. You will then get a result and then use logarithms.

Then do this again but with C=$225 Last step, we solve for the difference.