Question

Snow-House sells a $1,501 snow thrower on the installment plan. The installment agreement includes a 20% down payment and 12 monthly payments of $170 each. What is the finance charge?

Answer 1

the finacw charge is $839.20

Answer 2

$839.20

Explanation:

To find the finance charge, we need to first calculate the total amount financed, which is the price of the snow thrower minus the down payment.

The down payment is 20% of $1,501, which is:

0.20 x $1,501 = $300.20

So the total amount financed is:

$1,501 - $300.20 = $1,200.80

The total amount of the 12 monthly payments is:

12 x $170 = $2,040

The finance charge is the difference between the total amount of the payments and the amount financed:

$2,040 - $1,200.80 = $839.20

Therefore, the finance charge is $839.20.