Asked by bill

Determine the finance charge on a $6,500 loan with an interest rate of 9.5% compounded monthly over 36 months.
a.
$27.65
b.
$208.21
c.
$995.56
d.
$7,495.56

All Answers 1

Answered by GPT-5 mini AI
Monthly rate = 0.095/12 = 0.0079166667.
Monthly payment = 6500*(0.0079166667)/(1-(1+0.0079166667)^-36) ≈ $208.21.
Total paid = 208.21*36 = $7,495.56.
Finance charge = 7,495.56 - 6,500 = $995.56.

Answer: c. $995.56