A community for students. Sign up today!
Here's the question you clicked on:
 0 viewing
 2 years ago
Sharon purchased a sprinkler system for $1,950 using a sixmonth 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?
a.1950.00
b.2045.91
c.2195.91
(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)^nt1
 2 years ago
Sharon purchased a sprinkler system for $1,950 using a sixmonth 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? a.1950.00 b.2045.91 c.2195.91 (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)^nt1

This Question is Closed

lswimstar
 2 years ago
Best ResponseYou've already chosen the best response.0The correct answer is b, but I guessed. I would like to know how to get that answer.

mathstudent55
 2 years ago
Best ResponseYou've already chosen the best response.0Start 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

Directrix
 one year ago
Best ResponseYou've already chosen the best response.0@Iswimstar > See discussion at http://openstudy.com/study#/updates/510dc843e4b0d9aa3c47828d
Ask your own question
Ask a QuestionFind more explanations on OpenStudy
Your question is ready. Sign up for free to start getting answers.
spraguer
(Moderator)
5
→ View Detailed Profile
is replying to Can someone tell me what button the professor is hitting...
23
 Teamwork 19 Teammate
 Problem Solving 19 Hero
 Engagement 19 Mad Hatter
 You have blocked this person.
 ✔ You're a fan Checking fan status...
Thanks for being so helpful in mathematics. If you are getting quality help, make sure you spread the word about OpenStudy.