Question

Jedediah went to a payday lender and borrowed $900. He is told the finance charge will be $42 for two weeks. What is the total cost of his loan if it takes him 12 weeks to pay off the loan? here's the formula t=900+42(1+?) sum like that

Answer 1

$T=L+F(1+N)$

Where:

T = Total cost

L = Loan amount

F = Finance Charge

N = Number of Rollovers

so:

$\begin{gathered} L=900 \\ F=42 \\ N=\frac{12}{2}=6 \\ so\colon \\ T=900+42(1+6) \\ T=900+42(7) \\ T=900+294 \\ T=1194 \end{gathered}$

$1194