question archive John Walters is comparing the cost of credit to the cash price of an item
John Walters is comparing the cost of credit to the cash price of an item
Subject:AccountingPrice: Bought3
John Walters is comparing the cost of credit to the cash price of an item. If John makes an $80 down payment and pays $35 a month for 24 months, how much more will that amount be than the cash price of $685?
1.$ .____
A payday loan company charges 5 percent interest for a two-week period. What would be the annual interest rate from that company?
2. ____%
What is the interest cost and the total amount due on a six-month loan of $1,500 at 13.2 percent simple annual interest? Use simple interest formula: I = P x r x T
3. Interest $_____
4. Amount Due After 6 months: $____
Brooke lacks cash to pay for a $600 washing machine. She could buy it from the store on credit by making 12 monthly payments of $52.74 each. The total cost would then be $632.88. Instead, Brooke decides to deposit $50 a month in the bank until she has saved enough money to pay cash for the machine. One year later she had saved $642----in deposits plus $42 in interest. When she goes back to the store, she finds that the washing machine now costs $660. Its price has gone up 10%. Was postponing her purchase a good trade-off for Brooke? What other factors could be in play in this situation?
5. Good Decision; Yes or No and why
6. What other factors would affect the decision. List 2
