Question
An electric mixer was purchased on the installment plan for a down payment of $60 and 11 monthly payments of $11.05 each. The cash price was $170. Find the annual percentage rate.
Answers
Henry
Cost = 60 + 11.05*11 = $181.55
P = Po + Po*r*t = 181.55,
170 + 170*r*(11/12) = 181.55,
170 + 155.83r = 181.55,
155.83r = 11.55, r = 0.047 = 4.7%, APR.
P = Po + Po*r*t = 181.55,
170 + 170*r*(11/12) = 181.55,
170 + 155.83r = 181.55,
155.83r = 11.55, r = 0.047 = 4.7%, APR.