Question

James purchased a new coat for $289 he paid $50 down and borrowed the remainder he had to make a payment of $32.27 each how much interest did he pay on the loan

Answer 1

To calculate the interest paid on the loan, we need to determine the total amount borrowed and subtract the amount paid initially.

The total amount borrowed can be found by subtracting the down payment from the coat's purchase price:

Total amount borrowed = Purchase price - Down payment
= $289 - $50
= $239

Now, we can calculate the interest paid over the course of the loan. Since we know the monthly payment amount and the total amount borrowed, we can find the number of months it took to repay the loan. Then, we can calculate the interest paid using the formula:

Interest paid = Total payments - Total amount borrowed

First, let's find the number of months it took to repay the loan. We can divide the total amount borrowed by the monthly payment:

Number of months = Total amount borrowed / Monthly payment
= $239 / $32.27
≈ 7.408 (rounded to the nearest month)

Since the number of months should be a whole number, we'll round it up to 8 months.

Now, we can calculate the total payments made:

Total payments = Monthly payment * Number of months
= $32.27 * 8
= $258.16

Finally, we can calculate the interest paid:

Interest paid = Total payments - Total amount borrowed
= $258.16 - $239
= $19.16

Therefore, James paid $19.16 in interest on the loan.