Earl Miller Plans to Buy a Boat for $19,500 with an Interest

question 58

Short Answer

Earl Miller plans to buy a boat for $19,500 with an interest charge of $2,500. Earl figures he can afford a monthly payment of $650. If Earl has to pay 36 equal monthly payments, can he afford the boat?

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Definitions:

Offer of Compromise

A proposal made by one party to settle a dispute or lawsuit outside of court, often involving the payment of money.

Time Limit

A specific duration within which an action must be initiated or completed.

Mailbox Rule

A legal principle that an offer is considered accepted once the acceptance is dispatched, not when it is received by the offeror.

Verbal Acceptance

An agreement to the terms of an offer conveyed through spoken words rather than written.