Question

A computer is $699 on the installment plan.

Down payment: $100 Payments: $58 a month for 12 months

How much was Marge's finance charge on the computer?

$796

$97

$696.36

Answer 1

Therefore, Marge's finance charge on the computer is $97.

Explanation:

To calculate Marge's finance charge on the computer, we need to find the total amount she will pay for the computer through the installment plan and subtract the original purchase price.

Down payment = $100

Total amount paid for the computer = Down payment + Monthly payment * Number of months

Total amount paid = $100 + ($58 * 12)

Total amount paid = $100 + $696

Total amount paid = $796

Finance charge = Total amount paid - Purchase price

Finance charge = $796 - $699

Finance charge = $97

Therefore, Marge's finance charge on the computer is $97.