document.write( "Question 1206629: Jessica borrowed $5000 from the bank in order to buy a new piano. She will pay it off by equal payments at the end of 2 years. The interest rate is 8% compounded weekly. Determine the size of the payments and the total interest paid \n" ); document.write( "

Algebra.Com's Answer #844184 by ikleyn(52788) $\"\"$ $\"About$

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\n" ); document.write( "Jessica borrowed $5000 from the bank in order to buy a new piano.
\n" ); document.write( "She will pay it off by equal payments at the end of 2 years.
\n" ); document.write( "The interest rate is 8% compounded weekly.
\n" ); document.write( "Determine the size of the payments and the total interest paid
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document.write( "Use the formula for the periodical payment for a loan\r\n" );
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document.write( "    M = \r\n" );
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document.write( "where P is the loan amount; \r\n" );
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document.write( "r =  is the effective interest rate per period (per week in this problem);\r\n" );
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document.write( "n is the number of payments (total number of weeks in this problem); \r\n" );
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document.write( "M is the payment for the period (weekly payment in this problem).\r\n" );
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document.write( "    In this problem  P = $5000;  r = ;  n = 2*52 = 104.\r\n" );
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document.write( "Substitute these values into the formula and get for monthly payment\r\n" );
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document.write( "    M =  = $52.07.\r\n" );
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document.write( "Thus, the weekly payment is $52.07.\r\n" );
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document.write( "In total, Jane will have to repay  2*52*52.07 = 5415.28 dollars in 2 years.\r\n" );
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document.write( "The difference $5,415.28 - $5,000 = $415.28  is the interest she will pay for this loan.\r\n" );
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