Question

A bank is offering a loan to account holders. If they pay the full amount off in 14 months they are charged no interest. Denise needs a $6500 loan to get a new car, in order for her to avoid interest charge how much will she have to pay back each month?

Answer 1

Denise will have to pay $500 each month to avoid interest charge.

Answer 2

At least $500

Explanation:

Since no interest is charged on any loan paid fully within 14months, if Denise got a loan of $6500 to buy a car, then denise must pay in less than 14months in order for him not to be charged interest.

Assuming Denise paid all the loan within 13months, then for him not to be charged any interest on loan, he must he able to pay at least $6500/13 which is equivalent to $500 every month.