Posted by Amber on Saturday, May 7, 2011 at 4:35pm.
The price of a new car is $16,000. Assume that an individual makes a down payment of 25% toward the purchase of the car and secures financing for the balance at the rate of 6%/year compounded monthly. (Round your answers to the nearest cent.)
What monthly payment will she be required to make if the car is financed over a period of 48 mo? Over a period of 72 mo?
What will the interest charges be if she elects the 48mo plan? The 72mo plan?

finite math  Damon, Saturday, May 7, 2011 at 4:51pm
$12,000 loan amount
r = .06/12 = .005
n = 48 or 72
1+r = 1.005
(1+r)^n = .7871 for n = 48
1  (1+r)^n = .2129 for n = 48
payment = loan [ r/(1 (1+r)^n ) ]
payment for 48 months = 12,000[.005/.2129]
=$281.82
now you do the 72 months

finite math  Amber, Saturday, May 7, 2011 at 5:02pm
i got $198.87
what about the interest charges?

finite math  Damon, Saturday, May 7, 2011 at 5:12pm
LOL
well
12,000/48 = 250 per month with no interest.
you paid 281.82 including the interest at 6% compounded monthly

finite math  Amber, Saturday, May 7, 2011 at 5:22pm
(281.82250)*48?

finite math  Damon, Saturday, May 7, 2011 at 5:34pm
right

finite math  Tommy, Monday, September 17, 2012 at 1:40pm
Determine the simple interest rate at which will grow to in the months. Round your answer to the nearest tenth of percent
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