Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Sara is looking to purchase a washer and dryer. The Saturday newspaper had an advertisement for a local appliance store offering 90 days, same as

image text in transcribed
Sara is looking to purchase a washer and dryer. The Saturday newspaper had an advertisement for a local appliance store offering "90 days, same as cashr financing Sara asked how the financing worked and learned that she could pay for the washer and dryer any time during the first 90 days for the purchase price plus sales tax. If she waited longer, she would have to pay the purchase price, plus sales tax, plus 25.8% annual simple interest for the first 90 days, plus 4% simple interest per month (or any part of a month) on the unpaid balance after 90 days. Together, the washer and dryer cost $699 plus the 8.25% sales tax, Sara knew that her tax refund from the IRS would be $1,100, so she bought the washer and dryer confident that she could pay off the balance within the 90 days. Answer parts 1. through 4. 4. How much did it cost her to pay off this loan 14 days late? $ 81.03 cost of extra 14 days (Round to the nearest cent as needed.) What annual simple interest rate does this amount to? (Round to four decimal places as needed)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Introduction To Estimating Economic Models

Authors: Atsushi Maki

1st Edition

0415589878, 978-0415589871

More Books

Students also viewed these Finance questions