Question

Henry Devine bought a new dishwasher for$320 he paid $20 down and made 10 monthly payments of $34 what actually yearly rate did Henry pay

Answer 1

First we need to find the amount financed, total payments and total interest

Amount financed
320-20=300

Total payments
34×10=340

Total interest=total payments-amount financed
Total interest=340-300=40

Now to find the yearly interest rate use the formula of
I=(2yc)÷(m×(n+1))
I ?
Y number of months in a year 12
C total interest 40
M amount financed 300
N number of payments 10
I=(2×12×40)÷(300×(10+1))
I=0.2909×100=29.09%