Steve is buying an $1160 T.V on the installment plan. He makes a down payments of 200 he has to make monthly payment of 55.25 fo 21/2 years what is his finance charge

Answer:

Finance charge = $200

Step-by-step explanation:

Cost of the T.V. = $1160

Steve did the down payment = $200

Monthly payment done by Steve = $22.5

Duration for the periodic payments = 2.5 years

Number of periodic payments to be done = 12 × 2.5

                                                                      = 30

Amount paid in periodic payments = Number of periodic payments done × amount paid in each month

= 30 × $55.25

= $1657.5

Total payment done = Down payment + Amount paid in periodic payments

                                  = $200 + $1657.5

                                  = $1857.5

Therefore, finance charges = Total payments done - cost of T.V.

                                              = 1857.5 - 1657.5

                                              = $200

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