Question
Peg Gasperoni bought a $50,000 life insurance policy for $170 per year. Ryan Life Insurance Company sent her the following billing instructions along with a
Peg Gasperoni bought a $50,000 life insurance policy for $170 per year. Ryan Life Insurance Company sent her the following billing instructions along with a premium plan example:
"Your insurance premium notice will be mailed to you in a few days. You may pay the entire premium in full without a finance charge or you may pay the premium in installments after a down payment and the balance in monthly installments of $45. The finance charge will be added to the unpaid balance. The finance charge is based on an annual percentage rate of 12%."
| If the total policy premium is: | And you put down: | The balance subject to finance charge will be: | The total number of monthly installments ($30 minimum) will be: | The monthly installment before adding the finance charge will be: | The total finance charge for all installments will be: | And the total deferred payment price will be: |
| $170 | $45.00 | $125.00 | 3 | $45.00 | $2.65 | $172.65 |
| 270 | 65.00 | 205.00 | 5 | 45.00 | 5.77 | 275.77 |
| 370 | 90.00 | 280.00 | 7 | 45.00 | 10.69 | 380.69 |
What is your finance charge for the first three months? | ||||||
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Statistical Reasoning for Everyday Life
Authors: Jeff Bennett, Bill Briggs, Mario F. Triola
4th edition
978-0321817747, 321817745, 978-0321890139, 321890132, 321817621, 978-0321817624
