Bill Seeker bought a boat costing $8500 with $1500 down, the balance plus add-on interest to
be paid in 36 monthly installments. If the add-on interest rate was 18%, find

a. the total interest charged.

Question

Bill Seeker bought a boat costing $8500 with $1500 down, the balance plus add-on interest to
be paid in 36 monthly installments. If the add-on interest rate was 18%, find

a. the total interest charged.

anonymous · Answer

I deleted my post concerning annual interest rate since it has nothing to do with  this question.  The add on interest rate is applied once at the beginning of the loan.  So the taotal interest can be calculated by:
$$TotalInterest = (Cost - DownPayment)(addOnInterestRate)$$
$$TotalInterest = ($8500 - $1500)(0.18)$$
$$TotalInterest = $1260$$