Use an Annual Percentage Rate Table to Solve the Problem

question 59

Multiple Choice

Use an annual percentage rate table to solve the problem.
-A carpenter spent $6500 to purchase a table saw , a circular saw, and a panel saw. He paid 20% Down and financed the balance with a 30-month fixed installment loan with an APR of 5.0%. Determine the total finance charge and monthly payment for the loan.

• A) Total finance charge = $1062.36; Monthly payment = $208.75
• B) Total finance charge = $377.52; Monthly payment = $185.92
• C) Total finance charge = $342.68; Monthly payment = $184.76
• D) Total finance charge = $1147.90; Monthly payment = $254.93

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Definitions:

Involuntary Bankruptcy

A legal process initiated by creditors seeking to have a debtor declared bankrupt by a court, forcing the debtor to liquidate or reorganize their debts.

Bankruptcy Proceedings

The legal process through which individuals or entities unable to meet their financial obligations can seek relief from some or all of their debts.

Fair Market Value

The price that property would sell for on the open market, between a willing buyer and a willing seller.

Forced into Bankruptcy

A situation where an individual or company is legally compelled into declaring bankruptcy by creditors or legal action, often due to inability to pay outstanding debts.