A car dealer will sell you a used car for $5,478 with $478 down and payments of $112.08 per month for 60 months. What is the simple interest rate? (Round each answer to the nearest tenth.)

Answer 1

5,478-$478=$5,000
$112.08*60=$6,724.8
$6,724.8-$5,000=$1,724
$1,724/5=344.8
$344.8/$5,000=0.06896= 7.0% is this correct.

Answer 2

Yes, your procedure and answer is correct.