Chelsea made monthly payments for four years before her $13,440 loan was paid off. The loan had an interest rate of 5.86%, compo
unded monthly. Chelsea paid $156.60 in service charges. To the nearest tenth, what percentage of the total cost of the loan did her finance charges comprise? Round all dollar values to the nearest cent.
Given: PV = 13,440 i = 5.86% , compounded monthly t = 4 years
13,440(0.0586/12))/(1-(1+0.0586/12)^-48= 15,109.44 15,109.44 + 156.60 = 15,266.04 15,266.04 - 13,440.00 = 1,826.04 <span>1,826.04/15,266.04 = 11.96 % Percentage total of Finance Charge of the total loa</span>
