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Anthony purchased a bedroom set for $3,860 using a six-month deferred payment plan with an interest rate of 27.29%. What is the balance after the deferment period if payments of $172 are made each month?

A. $3,080
B. $2,676
C. $3,500
D. $3,240

User Jewell
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1 Answer

5 votes

Final answer:

The balance after the six-month deferment period, without considering the interest because the calculation details were not provided, would be the initial amount of $3,860 minus the total payments made, which is $1,032, resulting in a balance of $2,828.

Step-by-step explanation:

Anthony purchased a bedroom set for $3,860 using a six-month deferred payment plan with an interest rate of 27.29%. During this deferment period, he makes monthly payments of $172. To calculate the balance after the deferment period, we first need to calculate the total amount paid by Anthony over the six months, which is $172 multiplied by 6. Then, we subtract this total payment from the initial amount of $3,860 to find the remaining balance. Finally, we need to add the interest accrued during the deferment period, but as the problem does not provide a specific method for how the interest is applied (e.g., if it is compounded monthly, daily, or at the end of the deferment period), we'll assume no interest applies during the payment period in this scenario, as we are not provided information on how to calculate it.

Total Payments: $172 * 6 = $1,032

Balance after payments (without interest): $3,860 - $1,032 = $2,828

We don't have a method to account for interest accrual, so the remaining balance after the six-month period, assuming no interest accrual, would be $2,828. Given the options provided, none match this balance. It's possible there may have been an oversight in the problem's details regarding how to handle the interest. In a real-life context, interest would typically be added to the remaining balance according to the terms of the deferment plan.

User GTS
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