Answer
See below
Work Step by Step
(a)
Compute the Monthly payment as shown below:
\[\begin{align}
& PMT=\frac{P\times \left( \frac{r}{n} \right)}{\left[ 1-{{\left( 1+\frac{r}{n} \right)}^{-nt}} \right]} \\
& =\frac{\$15,374\times\left(\frac{0.18}{12}\right)}{\left[1-{{\left(1+\frac{0.18}{12}\right)}^{-12\times2}}\right]}\\&=\frac{\$15,374\times\left(0.015\right)}{\left[1-{{\left(1+0.015\right)}^{-24}}\right]}\end{align}\]
\[\begin{align}
& =\frac{\$230.61}{\left(1-0.6995\right)}\\&=\frac{\$230.6}{0.3005}\\&=\$767.5\\&\simeq\$768\\\end{align}\]
(b)
Compute the amounts as shown below:
\[\begin{align}
& \text{Total amount}=\text{Monthly Payment}\times n\times t \\
& =\$768\times12\times2\\&=\$18,432\end{align}\]
$\begin{align}
& \text{Total}\,\text{Interest}=\text{Total amount}-\text{Principal} \\
& =\$18,432-\$15,374\\&=\$3,058\end{align}$
