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March 6th, 2015, 02:11 AM  #1 
Newbie Joined: Mar 2015 From: UK Posts: 3 Thanks: 0  Car Finance PCP Calculation
Hi All, I am new to this forum..... I have come across the Car Finance PCP calculation in a website. I have given the example in the attachment. If I calculate the interest, it doesn't match with theirs one. I am puzzled..... Anyone can help please? Thanks in advance..... Regards, KMOthpur... 
March 6th, 2015, 09:18 PM  #2 
Math Team Joined: Oct 2011 From: Ottawa Ontario, Canada Posts: 13,986 Thanks: 995 
This is what it'll look like, in Bank statement format: Code: MONTH PAYMENT INTEREST BALANCE 00 18,280.00 01 361.50 87.53 18,006.03 02 361.50 86.22 17,730.75 ... 29 361.50 48.32 9,778.73 30 361.50 46.83 9,464.06 31 45.32 9,509.38 : optional final pay't ====== Total interest: 2,074.38 (1 + i)^12 = 1.059 i = .004788517365..... 18280 * .004788... = 87.53 (see 1st month's interest above) OK? 
March 9th, 2015, 06:54 AM  #3 
Newbie Joined: Mar 2015 From: UK Posts: 3 Thanks: 0 
Wow....Excellent..... Thanks a lot Denis... One final question.... How do they calculate 3.04% p.a.???? Regards, kmothpur. 
March 9th, 2015, 07:18 AM  #4 
Math Team Joined: Oct 2011 From: Ottawa Ontario, Canada Posts: 13,986 Thanks: 995 
Got no idea why that rate is shown...it is not used. (1+.059/12)^12 = 1.0606 1.0304^2 = 1.0617 Seems to be the semiannual equivalent rate (or close to) to the 5.9% cpd monthly...but that's a wild guess! Can you ask the car dealer what it means; I'd like to know... You guys in the UK always seem to come up with weird stuff 
March 9th, 2015, 07:46 AM  #5 
Newbie Joined: Mar 2015 From: UK Posts: 3 Thanks: 0  .... But sure... I ask them and let you know...... It will take a while but I will post.... Anyway, thanks Denis..... Regards, kmothpur. 

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calculation, car, finance, pcp 
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