Sharon purchased a sprinkler system for $1,950 using a six-month deferred payment plan. The interest rate after the introductory period is 23.99%. No down payment is required, but there is a minimum monthly payment of $25. What is the balance at the beginning of the seventh month if only the minimum payment is made each month during the introductory period?
(these answers are rounded to the fourth decimal place)
I was given this formula, but I can't figure it out: M=P(i(1+i)^nt / (1+i)^nt-1
Stacey Warren - Expert brainly.com
Hey! We 've verified this expert answer for you, click below to unlock the details :)
At vero eos et accusamus et iusto odio dignissimos ducimus qui blanditiis praesentium voluptatum deleniti atque corrupti quos dolores et quas molestias excepturi sint occaecati cupiditate non provident, similique sunt in culpa qui officia deserunt mollitia animi, id est laborum et dolorum fuga.
Et harum quidem rerum facilis est et expedita distinctio. Nam libero tempore, cum soluta nobis est eligendi optio cumque nihil impedit quo minus id quod maxime placeat facere possimus, omnis voluptas assumenda est, omnis dolor repellendus.
Itaque earum rerum hic tenetur a sapiente delectus, ut aut reiciendis voluptatibus maiores alias consequatur aut perferendis doloribus asperiores repellat.
I got my questions answered at brainly.com in under 10 minutes. Go to brainly.com now for free help!
The correct answer is b, but I guessed. I would like to know how to get that answer.
Start with 1950
After 1st month: 1950 -25 = 1925
After 2nd month: 1925 - 25 = 1900
After 3rd month: 1900 - 25 = 1875
After 4th month: 1875 - 25 = 1850
After 5th month: 1850 - 25 = 1825
After 6th month: 1825 - 25 = 1800
Future Value = P(1 + i)^n = $1950(1 + 23.99/100/12)^6 = $2195.91
Interest = Future Value - Present value = 2195.91 - 1950 = $245.91
$1800 + $245.91 = $2045.91