Question

Evelyn is buying a motorcycle that costs $14.000. The tax rate is 6.75%, and she plans to make a down payment of $1500. The sales tax is added before the down payment is applied. She is considering a three-year loan. The simple interest rate for a 3-year-loan is 6.75%. What will be her monthly payments. Round to the nearest cent.

Answer 1

Her monthly payment, if she is considering a three-year loan is $373.47

Given the cost of the motorcycle to be $14000If the tax rate is 6.75%,

the total cost plus tax is expressed as:

Final cost = 14000+(0.0675 * 14000)Cost of motorcycle = 14000 + 945Cost of motorcycle = $14945If

she plans to make a down payment of $1,500 before the sales tax isapplied, then; Balance = 14945 - 1500Balance = $13,445

If she considers a three-year loan, her monthly payment will be ;

Monthly payment = 13,445/36Monthly payment = $373.47

Hence her monthly payment if she is considering a three-year loan is $373.47