SOLUTION: You borrowed $500 from your parents to buy a computer. The arrangements of the loan are such that you will make payments of $125 per month plus 1% interest on the unpaid balance. F

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Question 854997: You borrowed $500 from your parents to buy a computer. The arrangements of the loan are such that you will make payments of $125 per month plus 1% interest on the unpaid balance. Find the first year's monthly payments you will make and the unpaid balance after each month. The find the total amount of interest paid over the term of the loan.
Answer by richwmiller(17219) About Me  (Show Source):
You can put this solution on YOUR website!
125*4=500 plus interest 1% of 500 is $5
125+5=130 for first payment
balance due
375 +3.75=128.75 2nd payment
balance due
250+2.50=127.50
125+.1.25=126.25
5+3.75+2.50+1.25=12.50
or do you mean ?
.01/12*500=.42
.01/12*375=.31
.01/12*250=.21
.01/12*125=.10
42+31+20+10=1.04