   Chapter 13.II, Problem 24RE ### Contemporary Mathematics for Busin...

8th Edition
Robert Brechner + 1 other
ISBN: 9781305585447

#### Solutions

Chapter
Section ### Contemporary Mathematics for Busin...

8th Edition
Robert Brechner + 1 other
ISBN: 9781305585447
Textbook Problem

# Calculate the finance charge and the annual percentage rate for the following installment loans by using the APR formula. Amount Number of Monthly Finance Financed Payments Payment Charge APR 29. $100,000 72$2,055.50

To determine

To calculate: The finance charge and annual percentage rate if amount financed is $100,000, number of payments is 72 and monthly payment is$2,055.50.

Explanation

Given Information:

The amount financed is $100,000, number of payments is 72 and monthly payment is$2,055.50.

Formula used:

When the table to compute APR is not given, the annual percentage rate (APR) is computed by the formula:

APR=72I3P(n+1)+I(n1)

Where, I is finance charge on the loan, P is principal or amount financed and n is number of monthly payment of the loan.

Calculation:

Consider that amount financed is $100,000, number of payments is 72 and monthly payment is$2,055.50.

Compute the total amount of installment payments by substituting monthly payment and number of monthly payments:

Total amount of installment payments=Payment per month×Number of monthly payments=$2,055.50×72=$147,996

Hence, the total amount of installment payment is $147,996. Compute the finance charge by substituting total amount of installment payment and amount financed: Finance charge=Total amount of installment paymentAmount financed=$147,996$100,000=$47,996

Hence, the finance charge is \$47,996

### Still sussing out bartleby?

Check out a sample textbook solution.

See a sample solution

#### The Solution to Your Study Problems

Bartleby provides explanations to thousands of textbook problems written by our experts, many with advanced degrees!

Get Started

#### In Exercises 7-10, solve for x or y. (3x)2+(74)2=45

Calculus: An Applied Approach (MindTap Course List)

#### Show that 13Tn+23Mn=S2n.

Single Variable Calculus: Early Transcendentals

#### limx1x3x21x = _____. a) 1 b) 1 c) 0 d) does not exist

Study Guide for Stewart's Single Variable Calculus: Early Transcendentals, 8th 