Question

Lucy needs a roof on her house. The cash cost is $8500. she decides to finance the project by paying 20% down, with the balance paid in 36 monthly payments of $205.34, determine the finance charge.

Answer 1

Given:

The cash cost is $8500.

The percentage of a down payment is 20 %.

The monthly pay =$ 205.34.

The number of months =36.

The down payment is

`=8500-(20)/(100)*8500`

`=8500-1700`
`=\text{ \$ 6800}`

The down payment is $ 6800.

The loan amount is

`=36*205.34`

`=7392.24`

The loan amount is $7392.24.

The finance charge is

`=7392.24-6800`

`=\text{ \$}592.24`

The finance charge is $ 592.24.