Alice Dubois was charged $455 in finance charges on a loan for 15 months. Find the finance charge refund if she pays off the loan in full after 10 payments.
(1/3) * 455 = 151.67
To find the finance charge refund, we need to calculate the amount of finance charges Alice would have paid if she had made all 15 payments. Then, subtract the actual amount of finance charges she has paid after 10 payments.
Step 1: Calculate the finance charge per month
We know that Alice paid $455 in finance charges for a loan of 15 months. So, we can find the finance charge per month by dividing the total finance charge by the number of months:
Finance charge per month = Total finance charge / Number of months
Finance charge per month = $455 / 15
Finance charge per month = $30.33
Step 2: Calculate the total finance charges for 15 months
If Alice had made all 15 payments, the total finance charges would have been:
Total finance charges = Finance charge per month x Number of months
Total finance charges = $30.33 x 15
Total finance charges = $454.95
Step 3: Calculate the finance charge refund
The finance charge refund is the difference between the total finance charges for 15 months and the actual finance charges paid after 10 payments:
Finance charge refund = Total finance charges for 15 months - Actual finance charges paid
Finance charge refund = $454.95 - Total finance charges paid after 10 payments
We don't have the information about the finance charges paid after 10 payments, so you would need to provide that in order to calculate the exact finance charge refund. Once you have that information, you can subtract it from $454.95 to find the finance charge refund.