Posted by Marty on Thursday, March 6, 2008 at 11:33am.
In order to make some home improvements, a home owner spent $40,000. He paid 20% as a down payment and financed the balance of the purchase with a 36month fixed installment loan with an APR of 7.5%. Determine the home ownerâ€™s a) total finance charge and b) monthly payment..
Use this partial APR table for finance charge per $100
Payments
Number Annual percentage rate
ofPmts 7.00% 7.50% 8.00% 8.50%
24 7.45 8.00 8.54 9.09
30 9.30 9.98 10.66 11.35
36 11.16 11.98 12.81 13.64
Each entry in the table represents finance charge/$100 at the given terms.

Maths  Reiny, Thursday, March 6, 2008 at 12:55pm
the monthly rate i is .075/12 = .00625
He finances 32,000 dollars, so
32000 = paym[1  1.00625^(36)]/.00625
this gave me a payment of $995.40
his total interest charge is 32000  36*995.40
= $3834.36
If I use your chart, the interest charge would be 11.96*36 = $3833.60 a difference of 76 cents.
I was using the accepted compound interest formula
Present value = paym(1  (1+i)^n)/i

Maths  Marty, Thursday, March 6, 2008 at 3:25pm
Thanks
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