Michael opens a store credit card when he purchases a new computer. The interest rate is 25.45%. He charges $2,380 to the card, and can pay $850 per month. What will the total cost of his purchase be?

Question

anonymous · Answer

$2,380.00

 $2,480.20

 $2,985.71

 $3,160.20

anonymous · Answer

@nincompoop @mathmale

anonymous · Answer

wouldnt mind some help

mathmale · Answer

I used to be a whiz at this kind of thing; my chief interest was determining the monthly payment of a loan whose principal, term and interest rate were all known.  In YOUR math problem you know the principal ($2,380), the interest rate (25.45%), and the monthly payment ($850).  Here the questions seem to be:  If we're paying $850 a month, at 25.45% interest, on a $2,380 loan, how long will it take to pay off the loan in full, and how much interest will have been paid?  

IF you're able to calculate the amount of interest paid on this loan, then the total cost of the new computer would be $2,380 PLUS that interest.  

Hope you have a reference book available, or at least online learning materials, that discuss the formulas useful for problems of this nature.  Do you?  If so, try to find the formula that applies here.   

Really wish I could do more, but having been on OpenStudy all day long, my mental capacities are (temporarily) slipping!