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nika2105 [10]
3 years ago
15

Barbara purchased a home entertainment center for $2,665 using an 18-month deferred payment plan with an interest rate of 24.36%

. She did not make any payments during the deferment period. What will Barbara's monthly payment be if she must pay off the home entertainment center within three years after the deferment period?
Mathematics
1 answer:
Andre45 [30]3 years ago
5 0

Answer:

P = $ 144.99

Step-by-step explanation:

Given data:

cost of home entertainment center is $2665

duration of deferred payment plan is 18 month

interest rate is 24.36%

Total amount to be paid is = P(1+ \frac{R}{100})^t

                                          = 2665 (1+ \frac{24.36}{100})^1.5

A = 3695.88

From the information in the questioon this amount is to be paid in 3 year . Thus we have

Monthly payment is =

P = \frac{r(Pv)}{1 - (1+ r)^{-n}}

p = monthly payment

Pv = present value = 3695.88

r =rate per period = \frac{24.36}{12} = 0.020

n = number of period = 12\times 3 = 36

plugging all value in the above formula

P = \frac{0.020\times 3695.88}{1 - (1+0.020)^{-36}}

P = $ 144.99

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