You purchase a computer for $755.00 plus 5% sales tax. You decide to finance it through the store's 0% program for six months. The terms state you must pay $50.00/month and that if you miss a payment, you will be assessed a late fee of $39.00 plus the interest accrued to that point on the initial amount at a 17.25% APR. If you miss a payment in the fifth month, how much interest will you be charged? (1 point) Responses $54.27 $54.27 $36.30 $36.30 $56.98 $56.98 $39.01
To calculate the interest charged for missing a payment in the fifth month, we need to determine the balance remaining on the computer at that point.
The initial cost of the computer is $755.00 plus 5% sales tax, which equals $755.00 * 0.05 = $37.75.
So the total cost of the computer with sales tax is $755.00 + $37.75 = $792.75.
Over six months, you will make six payments of $50.00, which totals $50.00 * 6 = $300.00.
Therefore, the remaining balance on the computer after the fifth payment is $792.75 - $300.00 = $492.75.
To calculate the interest charged, we need to find the interest accrued on the initial amount of $492.75 at a 17.25% APR for five months.
The monthly interest rate is 17.25% / 12 = 1.4375%.
The interest accrued for five months is $492.75 * (1.4375% * 5) = $35.35.
Therefore, the interest charged for missing a payment in the fifth month is $35.35.
The correct response is $35.35.