Question

purchase is financed by five annual payments of $1,000 the first payment due at time of purchase. The effective rate of discount, d, is 10%. Find the total amount of interest paid.

Answer 1

they paid a total of 590.49

Explanation:

1000 / 10 = 100 dollar discount he pays 900

900 / 10 = 90 they got a 90 dollar discount 810

810 / 10 = 81 they got an 81 dollar discount 729

729 / 10 = 72.9 they got a 72.9 dollar discount 656.1

656.1 / 10 = 65.61 they got a 65.61 dollar discount 590.49