Economics Today and Tomorrow, Student Edition
Economics Today and Tomorrow, Student Edition
1st Edition
ISBN: 9780078747663
Author: McGraw-Hill
Publisher: Glencoe/McGraw-Hill School Pub Co
Question
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Chapter 4.1, Problem 6R
To determine

To calculate:The total payment at the end of 24 months.

Expert Solution & Answer
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Explanation of Solution

Given the value of used car (P) = $10,000

The interest rate on loan (R) = 11%

Time period (T) = 24 months or 2 years.

Explanation:

  Simple interest = P × R ×T                        = $10,000 × 11% ×2                       =$2,200Total amount after 24 months = P + Simple interest                                               = $10,000 + $2,200                                                =$12,200

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