Actual cost of the car bought by Alvarez family = $2000 Amount of down payment made by the Alvarez family = $500 Outstanding amount that has to be paid by the Alvarez family = (2000 - 500) dollars = 1500 dollars Number of equal payments to pay the outstanding balance = 5 So Payment that has to be made by the Alvarez family in 5 equal parts = 1500/5 dollars = 300 dollars So the Alvarez family has to make 5 payments of $500 to complete the outstanding amount of the car. I hope the procedure is clear enough for you to understand.