Question

29. Diana financed a new $1,150 television at 10% for 36 months. How much will she have to pay every month to pay this off?$

Answer 1

Step 1

Given;

`An\text{ amount of \$1150 for a television financed at \$10 for 6 months}`

Required; To find how much will be paid every month to pay off the bill.

Step 2

State the formula for monthly payment

`A=P(r(1+r)^n)/((1+r)^n-1)`

where,

`\begin{gathered} A=\text{ }payment\text{ amount per period} \\ r=interest\text{ rate per period =}(10)/(100)=(0.1)/(12)=(1)/(120) \\ P=\text{ initial principal}=\text{ }1150 \\ n=\text{ }36 \end{gathered}`

Step 3

Find the amount paid per month

`\begin{gathered} A=1150(((1)/(120)(1+(1)/(120))^(36))/((1+(1)/(120))^(36)-1)) \\ A=1150((0.011234848)/(0.348181842)) \\ A=37.10726301 \\ A\approx\text{\$}37.11\text{ } \end{gathered}`

Therefore, Diana will pay approximately $37.11 each month until she pays off