Question

Forrest purchased a car for $20,640. He made a down payment of $2,440. He applied for a five-year installment loan with an interest rate of 10.4%. What is the total cost of the car after five years? (2 points)

Answer 1

Answer:

$32288.10

Step-by-step explanation:

Forrest purchased a car for $20,640.

He made a down payment of $2,440.

So, the remaining amount to pay $(20640 - 2440) = $18,200.

So, this amount will be paid by Forrest in an installment loan with an interest rate of 10.4%.

So, the price after interest after 5 years will be  

$18200(1 + \frac{10.4}{100} )^{5} = 29848.1$ dollars.

So, the total cost of the car after five years will be $(2440 + 29848.1) = $32288.10 (Answer)