SOLUTION: I am in business math and for the life of me I cannot figure out how to do this problem! Please help! Margie is buying a car. Her June monthly interest at 12 1/2% was $195. What

Question 571377: I am in business math and for the life of me I cannot figure out how to do this problem! Please help! Margie is buying a car. Her June monthly interest at 12 1/2% was $195. What was Margie's principal balance at the beginning of June? Please don't answer in Algebra, because I won't understand it. Thank you for your help.
Answer by Edwin McCravy(20056) (Show Source): You can put this solution on YOUR website!
I am in business math and for the life of me I cannot figure out how to do this problem! Please help! Margie is buying a car. Her June monthly interest at 12 1/2% was $195. What was Margie's principal balance at the beginning of June? Please don't answer in Algebra, because I won't understand it. Thank you for

The 12.5% is for a year. 

As a decimal that is .125

To get the percent interest for 1 month we divide the interest
rate for a year by 12

.125�12 = .0105166667

So the balance at the first of June was multiplied by that decimal
to get the $195 interest for the month.

So to find out what was multiplied by .0105166667 to get $195,

we divide 195�.0105166667 and get $18720

Edwin

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