Question

Dennis has just made the final monthly payment necessary for paying off his car financing. When he purchased the car three years ago, it had a list price of $23,878. Dennis traded in his good-condition 2001 Honda Odyssey and financed the rest of the cost at an interest rate of 11.82%, compounded monthly. The dealer gave Dennis 85% of the trade-in value of his car, listed below. Dennis was also responsible for paying 9.05% sales tax, a $1,474 vehicle registration fee, and a $225 documentation fee. All told, how much did Dennis pay in interest? (Round all dollar values to the nearest cent, and consider the trade-in to be a reduction in the amount paid.)

Answer 1

Answer:

$3,919.77

Step-by-step explanation:

I've taken this quiz already. It is a: $3,919.77

Answer 2

The interest that Dennis paid for his new car was $689.97.

Online Finance Calculator

We can use an online finance calculator to compute the interest that Dennis paid for his new car as follows:

Data and Calculations:

Auto Price = $23,878

Loan Term = 36 months (3 x 12)

Interest Rate = 11.82%

Down Payment = $0

Trade-in Value =$20,296 ($23,878 x 85%)

Sales Tax = 9.05%

Title, Registration and Other Fees =$1,699

Monthly Pay:   $118.67

Total Loan Amount = $3,582 ($23,878 - $20,296)

Sale Tax = $324.17

Upfront Payment = $2,023.17

Total of 36 Loan Payments = $4,271.97

Total Loan Interest = $689.97

Total Cost (price, interest, tax, fees) = $26,591.14

Thus, the interest that Dennis paid for his new car was $689.97.

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