Question

Determine the finance charge on an $8,000 loan with a monthly payment of $162.80 for 60 months.

a. $29.47
b. $162.80
c. $1,768.00
d. $9,768.00

Answer 1

The answer is c.) $1,768.00

Answer 2

option: C

Explanation:

We are asked to calculate the finance charge on an $ 8000

Now as there is a monthly payment of $162.80 which is been paid for 60 months.

so, total amount paid=$(162.80×60)=$9768

Now the loan was $8000

Hence the finance charge is the charge that he paid extra along with the loan.

Hence, finance charge= total amount paid- amount of loan

Finance charge=$9768-$8000=$1768

Hence option C is correct(i.e. the finance charge on an $8000 loan with a monthly payment of $162.80 for 60 months is $1768)