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Hello Looking for some assistance regarding the following problem. Any help is appreciated.

An installment contract for the purchase of a car requires payments of ​$285.56 at the end of each month for 5.5 years. Interest is 9% per annum compounded monthly.

​(a) What is the amount​ financed?

​(b) How much is the interest​ cost?

 Apr 4, 2021
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part a)

    PV = pmt {  (1-(1+i)-n ) / i }        PV is the financed amount at the beginning

                                                     pmt = 285.56  

                                                     i   is  interest is per month = .09/12     

                                                     n  is periods 5 1/2 years of months = 66

 

 

For part b     66 payments x 285.56       -   part a  = interest paid

 Apr 4, 2021

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