Question

A computer with software costs $2,915, and Catherine Stevens has agreed to pay a16% per year finance charge on the cash price. If she contracts to pay the loan in 18 months, how much will she pay each monthShe will pay $ each month. (Round to the nearest cent as needed.)

Answer 1

Given:

Cost = $2915

16% per year finance charge

Find-: Each month pay amount

Sol:

The cost of computer software = 2915

The percentage rate of the finance charge per 18 months will be.

Rate of change in 18 month is:

`\begin{gathered} ((16)/(12))*18 \\ \\ =24\% \\ \\ =0.24 \end{gathered}`

Now the find finance charge:

`\begin{gathered} =\text{ 0.24}*2915 \\ \\ =699.6 \end{gathered}`

Installment price = finance charge + cash price

The installment price is:

`\begin{gathered} =699.6+2915 \\ \\ =3614.6 \end{gathered}`

The installment payment = installment payment / number of payment

`\begin{gathered} =(3614.6)/(18) \\ \\ \approx201 \end{gathered}`

So each month payment is 201