Question

Use the formula to solve for c. Choose the right answer.

Amount Financed (m) = $600
Number of Payments per year (y) = 12
Number of Payments (n) = 24
APR (I) = 18%


A)112.33
B)112.12
C)112.50

Answer 1

(0.18×600×25)÷(2×12)
=112.5

Answer 2

The correct option is C). $112.50

Explanation:

Amount Financed (m) = $600

Number of Payments per year (y) = 12

Number of Payments (n) = 24

APR (I) = 18%

`\text{Time = }\frac{\text{Number of payments}}{\text{Number of payments per year}}\\\\\implies\text{Time = }(24)/(12)=2\text{ years}`

Now, c can be calculated by using the formula :

`c=\frac{\text{Amount financed}* Rate* (n+1)}{Time* \text{Number of payments per year}* 100}\\\\\implies c = (600* 18* (24+1))/(2* 12* 100)\\\\\implies c=(600* 18* 25)/(2* 12* 100)\\\\\implies c = 112.5`

Hence, The required value of c = $112.50

Therefore, The correct option is C). $112.50