Use an annual percentage rate table to solve the problem.

-A cattle rancher needs to construct a new silo in which to store cattle feed. The silo will cost $2000. The rancher pays 15% as a down payment and finances the balance for 60 months at an APR of 7.50%. Determine the rancherʹs total finance charge and monthly payment.
A) Total finance charge = $368.22; Monthly payment = $34.47
B) Total finance charge = $343.91; Monthly payment = $34.07
C) Total finance charge = $273.02; Monthly payment = $32.88
D) Total finance charge = $404.60 ; Monthly payment = $40.08

Question

Use an annual percentage rate table to solve the problem.

-A cattle rancher needs to construct a new silo in which to store cattle feed. The silo will cost $2000. The rancher pays 15% as a down payment and finances the balance for 60 months at an APR of 7.50%. Determine the rancherʹs total finance charge and monthly payment.
A) Total finance charge = $368.22; Monthly payment = $34.47
B) Total finance charge = $343.91; Monthly payment = $34.07
C) Total finance charge = $273.02; Monthly payment = $32.88
D) Total finance charge = $404.60 ; Monthly payment = $40.08

Quizplus · Accepted Answer

The down payment is 15% of $2000, which is $300. The financed amount is $1700. Using the APR table for 7.50% over 60 months, the monthly payment is approximately $34.07, and the total finance charge is approximately $343.91.

Use an Annual Percentage Rate Table to Solve the Problem