Charles Carr Borrowed $3,500 to Consolidate His Debts

question 19

Multiple Choice

Charles Carr borrowed $3,500 to consolidate his debts. Since Charles had an excellent credit rating, he was able to borrow at a 12% effective annual rate. Charles is required to make monthly payments. Charles will make equal payments for the next 36 months. Which one of the following values is closest to his monthly payments?

• A) $121
• B) $122
• C) $115
• D) $118
• E) $123

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Definitions:

Oral Contract

An agreement between parties that is spoken and not formally recorded in writing, yet is still legally binding under certain conditions.

Written Contract

A legally binding agreement documented in written form between parties, outlining terms and conditions.

Single Document

A term for an item typically consisting of written content on a single piece of paper or digital file, serving a specific informational or operational purpose.

Customized Goods

Products that are specifically made to the order and specifications of a customer.