# Math

Henry bought a new dishwasher for \$320. He paid \$20 down and made 10 monthly payments of \$34. What actual yearly interest did Henry pay?

1 - 14.55
2 - 29.09
3 - 34.38
4 - 68.75

1. 👍 0
2. 👎 0
3. 👁 234
1. Here is a quick approximate way to do it. Otherwise you need a much more complicated method, or some website that uses Java to do it for you.

(320 - 20)/2 = \$150 was the average balance during payoff.
Total interest payments were (340-320) = \$20
(5/6 yr)* %150*I (per yr) = \$20
I = 0.16 = 16%
It is actually a bit lower than that, because the average balance is a bit higher than \$150. So I'd got with 14.55%

1. 👍 0
2. 👎 0
posted by drwls
2. Henry bought a new dishwasher for \$320. He paid \$20 down and made 10 monthly payments of \$34. What actual yearly interest did Henry pay?

1 - 14.55
2 - 29.09
3 - 34.38
4 - 68.75

The monthly payment to pay off a loan derives from R = Pi/[1 - (1+i)^-n] where R = the monthly payment (or rent), P = the loan amount (or principal, n = the number of interest bearing periods and i = the yearly interest rate divided by 100(12).

R = 34
P = 300
i = I/100(12)annualized
n = 10 months
Therefore, 34 = 300i/[1 - (1+i)^-10].
By trial and error, I reached a yearly interest rate of 29.09%, or close enough for our purposes, 29% gives me a monthly payment of \$34.13.

For 29%, i = .29/12 = .024166666...
R = 300(.024166666)/[1 - 1.024166666)^-10] = \$34.13 per month.

You can play around with the % to get exactly \$34 if you wish.

1. 👍 0
2. 👎 0
3. \$34.38

1. 👍 0
2. 👎 0

## Similar Questions

1. ### Math

Henry Devine bought a new dishwasher for \$320. He paid \$20 down and made 10 monthly payments of \$34. What actual yearly interest rate did Henry pay?      A. 68.75 B. 14.55 C. 34.38 D. 29.09 My answer is B.

asked by Sarah on January 15, 2015
2. ### Math

Henry Devine bought a new dishwasher for \$320. He paid \$20 down and made 10 monthly payments of \$34. What actual yearly interest rate did Henry pay?      A. 68.75 B. 14.55 C. 34.38 D. 29.09 The answer is B?

asked by Tayler on January 14, 2015
3. ### math 4

Henry Devine bought a new dishwasher for \$320. He paid \$20 down and made 10 monthly payments of \$34. What actual yearly interest rate did Henry pay? A. 29.09 B. 68.75End of exam C. 14.55 D. 34.38 Please explain to me

asked by zyanna on August 4, 2014
4. ### math

Henry Devine bought a new dishwasher for 320. He paid 20 down and made 10 monthly payments of 34. What actual yearly interest rate did Henry pay? using this formula r=2mI/p(n+1) i got this r=2(12)(20)/300(10+1)= but i don't know

asked by joe on May 31, 2009
5. ### Algebra 1

The marketing director of a department store interviewed 50 customers who had bought appliances the previous week. They found that 20% of the customers bought a washing machine and 40% bought a dishwasher. Also 48% of the

asked by Sharon on May 14, 2014
6. ### math

Pam bought a new bedroom suit for \$2588.she made a down payment of \$188 and paid the remaining amount in 24 equal monthly payments.How much did she pay for each monthly payment? 188-24=164 is that how to do it? PLEASE REPLY BACK

asked by breyona on October 1, 2014
7. ### math

Joe bought a television for \$286.26, including tax. He made a down payment of \$20.00 and paid the balance in 6 equal monthly payments. What was Joe's monthly payment for this television?

asked by nicky on February 11, 2016
8. ### Math

Joe bought a television for \$286.26, including tax. He made a down payment of \$50.00 and paid the balance in 6 equal monthly payments. What was Joe's monthly payment for this television? A\$41.04 B\$39.37 C\$44.38 D\$31.04

asked by Katie Hairston on June 16, 2016
9. ### math

A newlywed couple bought a washer and dryer for \$800. They paid 5% down and then paid 12 monthly payments of \$65.41. Determine the APR of the loan to the nearest tenth of a percent.

asked by Jennifer on June 24, 2014
10. ### math

Kate bought a new car priced at \$21,300 with 15% down and the balance in equal payments over 4 years at 7% compounded monthly. Determine the size of the monthly payments? The answer is \$433.65 please show me the steps

asked by Daniel on June 10, 2013

More Similar Questions