Answer:
She will be able to pay off her loan completely in approximately 50 months
Step-by-step explanation:
The amount Esme earns as net salary = $2,400
The amount she already has in a savings account = $100
The amount she would be able to add to her savings account every month = $100
The cost of the car Esme plans to purchase on the no interest loan, A = $20,000
The amount she will make as payment on the loan every month, P = $300 per month
Let 'x' represent the number of month Esme will be able to pay off her loan completely, we have
The number of month Esme will have enough money to pay off her loan completely is given by the following equation;
20,000 = 100 + 300 × x + 100 × x = 100 + 400·x
∴ x = (20,000 - 100)/400 = 49.75
Therefore, the number of months she will be able to pay off her loan completely = 49.75 months ≈ 50 months.
