document.write( "<A HREF=/cgi-bin/jump-to-question.mpl?question=1174965>Question 1174965</A>: <I><SPAN STYLE=\"word-break: break-all;\"> A customer purchases a television for $800 using a credit card. The interest is charged on any unpaid balance at the rate of 18% per year compounded monthly. If the customer makes no payment for one year, how much is owed at the end of the year? </SPAN>\n" );
document.write( "</I><HR><TABLE width=100%><TR><TD><B><A HREF=http://www.algebra.com/>Algebra.Com's</A> Answer #800490 by </B><A HREF=/tutors/aboutme.mpl?userid=Theo><B>Theo(13342)</B></A><img src=\"/images/stars/stars-13.gif\" alt=\"\" >&nbsp;<A HREF=/tutors/aboutme.mpl?userid=Theo><IMG SRC=http://www.algebra.com/images/aboutme-small.gif BORDER=0 alt=\"About Me\" VALIGN=MIDDLE></A>&nbsp;<IMG SRC=http://www.algebra.com/cgi-bin/show-face.mpl?user=Theo><BR>You can <A HREF=\"/cgi-bin/embed-solution.mpl?show=1&solution=800490\">put this solution on YOUR website!</A><BR><SPAN STYLE=\"word-break: break-all;\"> f = p * (1 + r) ^ n<BR>\n" );
document.write( "f is the future value<BR>\n" );
document.write( "p is the present value<BR>\n" );
document.write( "r is he interest rate per time period<BR>\n" );
document.write( "is the number of time periods.\r<BR>\n" );
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document.write( "in this problem, the time periods are in months.\r<BR>\n" );
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document.write( "the number of months is 1 year * 12 = 12 months.<BR>\n" );
document.write( "the interest rate per month is 18% per year divided by 12 = 18/12% = 1.5% per month.\r<BR>\n" );
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document.write( "the formula becomes:\r<BR>\n" );
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document.write( "f = 800 * (1 + .015) ^ 12 = 956.4945372.\r<BR>\n" );
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document.write( "the amount of money owed at the end of 1 year is 956.49 rounded to the nearest penny.\r<BR>\n" );
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document.write( "in this formula, the rate is used, not the percent.<BR>\n" );
document.write( "rate = percent / 100.\r<BR>\n" );
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document.write( " </SPAN>\n" );
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