Question

Forrest purchased a car for $20,640. He made a down payment of $2,440. He applied for a five-year installment loan with an interest rate of 10.4%. What is the total cost of the car after five years? (2 points)

Answer 1

$32288.10

Explanation:

Forrest purchased a car for $20,640.

He made a down payment of $2,440.

So, the remaining amount to pay $(20640 - 2440) = $18,200.

So, this amount will be paid by Forrest in an installment loan with an interest rate of 10.4%.

So, the price after interest after 5 years will be

`18200(1 + (10.4)/(100) )^(5) = 29848.1` dollars.

So, the total cost of the car after five years will be $(2440 + 29848.1) = $32288.10 (Answer)