A man bought a house for 76,000. he made a down payment of 26,000 and agreed to pay 2,500 each year with a interest of 14% on an unpaid balance. His payment at the end of the second year was?
strange question
Are you saying his annual payment is $2500 + the interest?
If so, then ...
Balance now = $50,000
interest at end of 1st year = $7000
payment = 2500 + 7000 = $9500
Balance at end of 1st year = $47,500
interest at end of 2nd year = $6,650
payment at end of 2nd year = 2500 + 6650 = $9150
To find out the payment at the end of the second year, we need to calculate the remaining balance after the first year and then apply the interest rate to that balance.
First, let's determine the remaining balance after the down payment. The man bought the house for $76,000 and made a down payment of $26,000. Therefore, the remaining balance after the down payment is $76,000 - $26,000 = $50,000.
Next, we need to calculate the interest on the remaining balance. The interest rate is 14%, which means 14/100 = 0.14 in decimal form. The interest for the second year is 0.14 * $50,000 = $7,000.
Now, we can find the payment at the end of the second year. The man agreed to pay $2,500 each year, so the payment at the end of the second year will be the annual payment of $2,500 plus the interest of $7,000. Therefore, the payment at the end of the second year is $2,500 + $7,000 = $9,500.
So, the man's payment at the end of the second year is $9,500.