Question

Frank purchased a car for $14,870. He made a down payment of $1,640. He applied for a five-year installment loan with an interest rate of 9.6%. What is the total cost of the car after five years?

$14,500.08

$16,297.52

$16,710.00

$18,350.00

Answer 1

http://ncalculators.com/loan/installment-loan-payoff-calculator.htm

Answer 2

you can enter information on that website and get answer

Answer 3

The website is saying it's $16,710.00
??

Answer 4

yes that is what I got as well on the website

Answer 5

It's incorrect

Answer 6

total cost would be the 16710 + down payment given

Answer 7

so it is 16710 + 1640.00

the question asks for total cost of the car

Answer 8

Forrest purchased a car for $20,640. He made a down payment of $2,440. He applied for a five-year installment loan with an interest rate of 10.4%. What is the total cost of the car after five years?

$20,092.80

$23,417.40

$25,857.40

$22,786.56

is a question similar to the one I asked originally

Answer 9

same way you did the last one

Answer 10

remember to add the down payment

Answer 11

what did you get ?

Answer 12

The answer was $25,857.40

Answer 13

but the website is telling me that answer is $23,417.40
but I know for sure it's $25,857.40 because it's from a test I took already and I submitted the answer as $25,857.40
and I got it right

Answer 14

This shows the mathematics behind what the financial calculator is doing "behind the scenes". I'm going with problem #1 for now. After making a down payment of 1640, you have loan of 13230 which is the purchase price of the car minus the down payment. This is an annuity. You have a present value or loan of 13230 and you essentially want to find out what your monthly payment is. For the moment, we are going to calculate the present value of "1" instead. That's monthly payments of "1 dollar". This is mathematically the sum of a geometric series:

1(discounted for 1 month) + 1(discounted for 2 months) + . . . +
1((discounted for 60 months)

That discount factor is your yearly APR, divided by 12, add 1, and then take the reciprocal because it is discounted, not compounded:

In English:

1/[0.096 / 12 + 1] = 0.99206349206349206349206349206349 = x

So,

x + x^2 + x^3 + . . . + x^58 + x^59 + x^60

that equals x(x^60 - 1)/(x - 1) = y with "x" as defined as above. This is the present value of 1 for this problem. But we want what would equal 13230, not the present value of a string of payment of 1 dollar. So, we divide 13230 by this "y" and we have our monthly payment.

This is a lot of work and a lot of theory, but this is what the calculator is doing. You multiply that monthly payment by 60, add your down payment, and you get "D" for the answer to the first problem.

Answer 15

thank you! I got D for the first answer as well

Answer 16

Feel free to ask any and all questions about the math. If you're a financial major, maybe you don't care about the math really. But if this is for a math class, you'll have to get this down pat.

Answer 17

you're very welcome. The 2 key concepts, mathematically is that the string of payments is an annuity where you work with present value and use the interest rate to calculate the discount factor (reciprocal of the compounding factor).

Answer 18

btw, the monthly payment calculates out to be:

278.50160723822413258486621723079

from:

47.50421418100955439945916710245

which is the present value of 60 monthly payments of 1 dollar. If we multiply that last number by our monthly payment, we get the loan amount, 13230.

Answer 19

That might have looked a little bit like magic, but all I did was work backwards. I calculated the monthly payment from:

47.50421418100955439945916710245

which was where all the work was.

13230 / 47.50421418100955439945916710245 = monthly payment.

Answer 20

Would you know how to do this one?

What percentage of television watchers for “The Code” is between 28 and 34-years-old?

http://tinypic.com/view.php?pic=34xs6e8&s=5

25%

40%

50%

75%

Answer 21

I was stuck in between 40 or 50% but I would say the answer is 40%

Answer 22

It's been a long time since I had stats, but if I remember correctly, that figure is showing quartiles. The first is the first skinny bar, the second is the blue box, the third is the green box, and the fourth is the second skinny line. The key (if I remember right) is that these are all quartiles and break your data up neatly into chunks of "25%" and the way I see it, it looks like 28 to 34 is the bounds on the green box, giving a neatly-divided 25%. But I'm not positive. While you read this, I'm going to go check.

Answer 23

Yes, this is just a box and whisker boxplot associated with quartiles. Here, we see it sideways. You can brush up a little at:

http://en.wikipedia.org/wiki/Box-and-whisker_diagram

So, think "quartiles", look for the boundaries of that green box, and you will arrive at your answer.

Answer 24

This is all so confusing