Future Business Leaders of America (FBLA) Business Calculations Practice Test

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Dive into the FBLA Business Calculations Test. Sharpen your analytical skills with multiple-choice questions and gain insights with detailed explanations. Excel in your exams!

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What is the total monthly payment for an automobile loan given a monthly principal and interest of $510, annual taxes of $1200, and insurance of $600?

$510
$660
$2310
$192.50

The correct answer is: $660

To determine the total monthly payment for the automobile loan, you need to combine the monthly principal and interest, the monthly portion of the annual taxes, and the monthly portion of the insurance. 1. The monthly principal and interest payment is given as $510. 2. The annual taxes amount to $1200, so the monthly tax payment is calculated by dividing the annual figure by 12 months. This results in $1200 / 12 = $100 per month. 3. The insurance cost is $600 annually, which also needs to be converted to a monthly figure by dividing it by 12. This gives $600 / 12 = $50 per month. Now, add these amounts together to get the total monthly payment: - Monthly principal and interest: $510 - Monthly taxes: $100 - Monthly insurance: $50 Thus, the total monthly payment is: $510 + $100 + $50 = $660. This calculation shows that the total monthly payment for the automobile loan, including principal, interest, taxes, and insurance, is indeed $660.