Question

Follow the steps above and find c, the total of the payments, and the monthly payment. Choose the right answers. Sally Seair buys a sailboat. The price, including tax, is $5,275.00. She finances the boat over 36 months after making a $500 down payment. The true annual interest rate is 15%. What are Sally's monthly payments (principal plus interest)? To the nearest penny, c = $. Total of payments = amount financed + c = $. Total of payments ÷ number of payments = monthly payment = $.

Answer 1

Answer:

Sally's Monthly payment = $166.70

Step-by-step explanation:

The price of the boat including tax = $5275

The down payment = $500

Remaining amount = $5275 - $500 = $4775

She has to take loan for $4775

P = $4775,

Rate per montly =15%/12 = 15/100 ÷12 = 0.15÷12 =0.0125

n =36 months

Here we have to use the formula

Monthly payment = [p*r*(1+r)^n ÷ (1 + r)^n - 1]

= (4775*0.0125*(1+0.0125)^36 / (1+0.0125)^36 - 1)

= (59.6875*1.0125^36) ÷ [(1.0125)^36 -1]

= 93.35 ÷ [ 1.56 -1]

=93.35 ÷ 0.56

= $166.70

Monthly payment = $166.70

Thank you.