asked 54.7k views
2 votes
Consider the following advertisement for BrightLending, a short-term personal loan operator.

Loan amount: $800

Deposit date: Tuesday, May 17, 2022

Repayments: 22 payments of $203.40 bi-weekly

1st Payment due: Friday, May 27, 2022

a) If someone took out the $800 loan shown in the ad, how much would they pay in total for the loan?

b) How long is it taking this person to pay off the loan, in years?

2 Answers

3 votes

if we nevermind the deposit and repayment dates, since they are not relevant for this case, so we have only a loan for $800 to be repaid in 22 weeks, at 203.40 every other week, biweekly namely.

Now, we can also nevermind the biweekly part, 22 payments are 22 regardless if it's done daily or yearly or bimonthly or bidecade, 22 is just 22.

a)

22 payments at 203.4 is just (22)(203.4) = 4474.8.

b)

how long does that take?

well, hell the loaner doesn't give much choices, you pay it every other week 22 times, how many weeks is that? 22*2 = 44 weeks.

Since we know a year has 52 weeks, then 44 weeks is just 44/52 of a year, namely


\cfrac{44}{52}\implies \cfrac{11}{13} ~~ \approx ~~ \text{\LARGE 0.85}~years

answered
User Rishad Baniya
by
9.1k points
1 vote

Answer:

a) $4,475.20

b) it would take approximately 0.846 years or approximately 10 months to pay off the loan.

Explanation:

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