Will give medal! You (or your parents) purchase a used car for $15,867 plus 5.25% sales tax. The down payment is 10% of the total cost and you have excellent credit rating. What is your principal balance at the start of the loan? APR for excellent credit rating is 5.25%,

Question

Cecilia Gibbs

Mathematics

4 April, 15:58

Will give medal! You (or your parents) purchase a used car for $15,867 plus 5.25% sales tax. The down payment is 10% of the total cost and you have excellent credit rating. What is your principal balance at the start of the loan? APR for excellent credit rating is 5.25%,

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Dolce · Answer 1

To answer this question you will not need the APR of 5.25%.

You will calculate your cost with sales tax by multiplying $15867 by 1.0525. The amount is $16700.02.

You put 10% down, so this leaves you with 90% to pay. Next, multiply 0.90 by 16700.02.

You will have a starting principal of $15030.02.