Question

Jake took out an interest-free loan of $2,401.56 from the bank to buy a car. He paid the bank $200.13 each month until it was paid back completely. Which of the following is true? A. Jake paid his loan back in 13 months. B. Jake paid his loan back in 11 months. C. Jake paid his loan back in 14 months. D. Jake paid his loan back in 12 months.

Answer 1

Choice: D. ake paid his loan back in 12 months.

Explanation:

Proportions

Jake took an interest-free loan of P=$2,401.56 from the bank. He paid the bank $200.13 each month to pay back the loan completely.

To calculate the number of months Jake took to repay the loan, we just divide the total amount by the monthly payment. This can only be done because the loan is interest-free.

Number of payments = $2,401.56 / $200.13 = 12

Choice: D. ake paid his loan back in 12 months.