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Freda Frederick purchased furniture with an installment loan that has an APR of 8%. The furniture sells for $3,000. The store financing requires a 10% down payment and 18 monthly payments. What is the monthly payment?

Freda Frederick purchased furniture with an installment loan that has an APR of 8 The furniture sells for 3000 The store financing requires a 10 down payment an class=

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BlueSky06
The furniture sells for the price of $3000.
Downpayment should be 10%, we have:
Balance = $3000 - (3000*10%)
Balance = $2700
Plus 8% in the balance for the APR, we have:
New Balance = 2700 + (2700*5.91%)
New Balance = $2,859.57
Divided by 18 months, we have:
Monthly payment = $2,859.5718
Monthly payment = $158.87

The monthly payment is $158.87.

Answer:

The monthly payment is $158.90.

Step-by-step explanation:

The furniture sells for $3,000.

The store financing requires a 10% down payment.

The down payment is = [tex]0.10\times3000=300[/tex] dollars

Now the balance remains = [tex]3000-300=2700[/tex] dollars

We will add 8% in the balance for the APR, that is 5.91% as given in the table.

[tex]0.0591\times2700=159.57[/tex]

So, the balance becomes = [tex]2700+159.57=2859.57[/tex] dollars

As the store needs 18 monthly payments, so per month payment is =

[tex]\frac{2859.57}{18}=158.865[/tex] or $158.90

Therefore, the answer is $158.90.

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