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Curtis purchased a mountain bike for $650.00 with 75% down. He will make 12 payments of $24.38...

Question:

Curtis purchased a mountain bike for $650.00 with 75% down. He will make 12 payments of $24.38 each.

1. What is the total amount paid (including down payment)?

a. $781.06

b. $751.62

c. $749.62

2. What is the finance charge in dollars?

a. $131.06

b. $121.62

c. $111.62

Finance Charge:

When a person avails debt, they repay more than the money they borrowed. This difference is identified as the finance charge. This is the profit realized by the lender on account of lending.

Answer and Explanation: 1

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Correct answer:

1. Option a. $781.06

2. Option a. $131.06

Given:

Cost of the bike = $650

{eq}\begin{align*} {\rm\text{Down payment}}\, &=...

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What Is Financing? - Definition & Types

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Chapter 8 / Lesson 7
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When a person is need of financial assistance, they may go to a financial institution and request financing, which is when a financial institution sets up a program to help a lender make a purchase with the promise to repay in an affordable manner. Explore the idea of financing, looking at the different types of financing that are available to consumers.


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