question about math?

pls help

Update:

Stacie Howard purchased a water softener for $450. She made a down payment of $50 and paid the balance off in 36 monthly payments. Find the monthly payment if the finance charge was 9% of the amount financed. Round the answer to the nearest cent.

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  • 9 months ago
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    Presuming monthly interest, this is the loan payment equation:

    P = r(PV) / [1 - (1 + r)^(-n)]

    Where:

    P = monthly payment

    PV = Present Value (or principal)

    r = rate per period

    n = number of periods

    If 9% is the annual rate, then the rate per period is 9/12 % or 0.75 % (or 0.0075)

    There are 36 periods.

    The PV is $400.

    If we substitute this info into what we have, here's what is left:

    P = 0.0075(400) / [1 - (1 + 0.0075)^(-36)]

    I'll continue to use decimal approximations rounded to 7-8 digits but will attempt to keep the number as-is in the calculator to reduce errors due to rounding. Simplifying this we get:

    P = 0.0075(400) / [1 - (1.0075)^(-36)]

    P = 3 / (1 - 0.764149)

    P = 3 / 0.2358510

    P = $12.72 (rounded to the nearest penny)

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