Ian purchased a car by making a down payment of
$6,000 and weekly payments of $325 at the
end of every week for 7 years. If interest was
2.85% compounded weekly, what was the purchase price of the car?
What was the cost of financing? Round all answers to two
decimal places where necessary. Enter only positive
values for the "Purchase Price of the Car", and "Cost of
Financing".
N = I/Y = % P/Y = C/Y =
PV = $ PMT = $ FV = $
Purchase Price of the Car = $ Cost of Financing = $
Here
| Number of Installments | 364 | |
| Installment amount | $325.00 | |
| Interest @ 2.85% | ||
| Total Amount paid = | 6000 | + | 118300 |
| Total Amount paid = | 124300 |
Formula here is
Monthly Payment =( interest rate/ 52 Weeks)*Principal / (1-(1+Interest rate/52)^ total number of weeks 364
Hence Principal = (325*(1-(1+2.85%/52)^-364))/(2.85%/52) = 107220
Hence cost of Car = 107220+6000 That is $113220
And Hence cost of Financing = 124300-113220 That is $11080
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