A nurse borrows $6385 for the purchase of a car. If she pays a simple interest rate of 8.5% for 15 months, what will she owe at the end of the 15 months? Round your answer to the nearest cent. MY ANSWER IS $14,525.88

Question

A nurse borrows $6385 for the purchase of a car.  If she pays a simple interest rate of 8.5% for 15 months, what will she owe at the end of the 15 months?  Round your answer to the nearest cent. MY ANSWER IS  $14,525.88

quin100 · Answer

do you know how to start the problem?

anonymous · Answer

6385(1+8.5%.15)

quin100 · Answer

okay what do u think the next step is?

tkhunny · Answer

I = Prt -- EVERY time!

First Month:

I = $6,385.00 * 0.085 * (1/12) = $45.23

Okay, she owes $45.23 in interest at the end of the 1st month.

Unfortunately, this is where we have to stop because we have insufficient information.  Obviously, the term of the loan is more than 15 months.  How long is it?  We have to know this to know how much principle she pays at the end of the 1st month.

Let's see if we can reproduce your answer.

15 months is 1.25 years.

I = $6,385.00 * 0.085 * (1.25) = $678.41
Total Loan  = $6,385.00 + $678.41 = $7,063.41

No clue how you managed your result.

We need the rest of the problem statement.

anonymous · Answer

Thats the whole problem in my homework @tkhunny

anonymous · Answer

This is in the choices though $7,063.41 @tkhunny

tkhunny · Answer

Well, we need more information.  What is the length of the loan?  It CANNOT be solved without that information.  No wonder you're struggling with it.  That's exactly what you should be doing.  :-)  and :-(

tkhunny · Answer

Well, we still have to make an assumption.  IF we assume that she makes NO principle payment, then that is the right answer.  We have to make SOME additional assumption past what is given in the problem statement.

Term of the Loan?  We can solve with that.
Periodic Repayment Amount?  We can solve with that.

Perhaps we should assume $0.00 for the latter.