1. **Problem Statement:** Boris wants to buy a car costing $27000. He must pay 20% down payment. The rest is financed with a 3-year loan at 7% annual interest compounded monthly. 2. **Calculate the down payment:** Down payment = 20% of $27000 = $27000 \times 0.20 = $5400 3. **Calculate the loan amount:** Loan amount = Total cost - Down payment = $27000 - $5400 = $21600 4. **Calculate the monthly payment:** The loan amount $P = 21600$ Annual interest rate $r = 7\% = 0.07$ Monthly interest rate $i = \frac{0.07}{12} = 0.0058333333$ Number of months $n = 3 \times 12 = 36$ Use the amortization formula for monthly payments: $$M = P \times \frac{i(1+i)^n}{(1+i)^n -1}$$ Calculate $M$: $$M = 21600 \times \frac{0.0058333(1+0.0058333)^{36}}{(1+0.0058333)^{36} - 1}$$ Calculate $(1 + i)^{36}$: $$1.0058333^{36} \approx 1.238364$$ So, $$M = 21600 \times \frac{0.0058333 \times 1.238364}{1.238364 -1} = 21600 \times \frac{0.007220}{0.238364}$$ $$M = 21600 \times 0.030298 = 654.37$$ **Monthly payment is approximately $654.37** Final answers: (a) Down payment: $5400.00$ (b) Loan amount: $21600.00$ (c) Monthly payment: $654.37$