Question

Hillary would like to buy a some new furniture. Rather then pay for thefurniture all at once, she decides to purchase it with an installment plan.She needs to put 12% down on the $3,210 Furniture. The remainingbalance she would pay back over the next 4 years. The monthly paymentsusing the installment plan are $68.2. What is the finance charge? Roundyour answer to the nearest cent. Do not include a dollar sign in youranswer.

Answer 1

the cost of the furniture is 3210

she puts 12% down

3210 x (12/100)=385.20

lets find the balance

3210-385.20=2824.80

this balance needs to be paid back in 4 years

the monthly payment is 68.20

4 years x 12 months= 48 months

48 x 68.20=3273.60

her original balance was 2824.80

the finace charge is:

327.60-2824.80=448.80

we need to round to the nearest cent which is 448.80