Question 939541: Southland, Inc. has just borrowed $50,000 to purchase a delivery truck. The contract calls for 4 annual payments of $15,773.54, beginning one year from today. The annual interest rate Southland is paying equals
Answer by stanbon(75887)   (Show Source):
You can put this solution on YOUR website! Southland, Inc. has just borrowed $50,000 to purchase a delivery truck. The contract calls for 4 annual payments of $15,773.54, beginning one year from today. The annual interest rate Southland is paying equals.
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total payment = 4*15,773.54 = 63,094.16
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total interest = 13,094.16
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Formula for simple interest:: I = Prt
13,094.16 = 50,000*r*4
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r = 13094.16/200000 = 0.0655 = 6.55%
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Cheers,
Stan H.
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