SOLUTION: Jack found the stereo of his dreams. He made a $600 down payment and financed the remaining balance using a loan. Jack agreed to pay off his loan in 3 years making monthly payments
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Question 619822: Jack found the stereo of his dreams. He made a $600 down payment and financed the remaining balance using a loan. Jack agreed to pay off his loan in 3 years making monthly payments of $30 at 12% compounded monthly.
How much did Jack borrow at time of purchase?
What was the selling price of the stereo?
Please help! Thank you Answer by ewatrrr(24785) (Show Source):
Hi,
Jack agreed to pay off his loan in 3 years making monthly payments of $30 at 12% compounded .
36· $30 =
1080 = P(1.01)^36
1080/1.43 = P = $755.24, the amount borrowed
What was the selling price of the stereo? 600 + $755.24 = $1355.24
