Posted by **Jennifer** on Tuesday, June 24, 2014 at 7:10pm.

A farmer buys a new tractor for $38,000. He makes a down payment of $10,000 and finances the balance at 8.5% APR over 48 months. Before making the 12th payment, the farmer decides to pay the remaining balance on the loan. How much interest will the farmer save (use the actuarial method)?