Consumer credit
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Consumer Credit. Review for quiz tomorrow. What we covered:. Saving & Rounding Finding a down payment Layaway Plans Finding the finance charge (interest) Expressing the finance charge algebraically Monthly payments Combining this with previous material . Saving & Rounding.

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Consumer Credit

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Consumer credit

Consumer Credit

Review for quiz tomorrow


What we covered

What we covered:

  • Saving & Rounding

  • Finding a down payment

  • Layaway Plans

    • Finding the finance charge (interest)

    • Expressing the finance charge algebraically

  • Monthly payments

  • Combining this with previous material


  • Saving rounding

    Saving & Rounding

    • You want to purchase a $2,500 television. You are willing to save $275 per month. How long will it take for you to save up for the television?

    • You purchase an electric keyboard that costs $2,344. You can afford to save $150 per month. How long will it take?


    Finding a down payment

    Finding a down payment

    • You want to purchase a house for $250,000. You are required to pay a down payment of 20%. How much is your down payment?

    • You purchase a dining room set for $5,100. You sign up for an installment plan, which requires an 18% down payment. How much is the down payment?


    Layaway plans

    Layaway plans

    You purchase a bicycle that sells for $2,500. It requires a 25% down payment and monthly payments over the next 3 years of $85.75. How much is the finance charge?

    down payment =

    ( $2,500) x (0.25)

    = $625

    Monthly payments:

    ($85.75) (36)

    = $3,087

    Total Paid:

    $625 + $3,087

    = $3,712

    Finance Charge:

    $3,712 - $2,500

    = $1,212


    Consumer credit

    The price of a stove is “s” dollars. You make a 10% down payment for a 1 ½ year installation purchase. The monthly payment is “m” dollars. Express the finance charge algebraically.

    down payment =

    10% of s

    = 0.1s

    Monthly payments:

    m dollars for 1 ½ years

    = 18m

    Finance Charge:

    Paying Price – Selling price

    = 18m

    + 0.1s

    - s


    Monthly payments

    Monthly Payments

    • You purchase a video game system that costs a total of $350. At the time of purchase, you are required to pay a down payment of 12%. The installment plan you agree to requires a minimum of $5 monthly payment and offers no interest for 2 years. If you make the minimum payment every month, how much must your last payment be to avoid paying interest?

    down payment =

    ( $350) x (0.12)

    = $42

    Monthly payments:

    ($5) (23)

    = $115

    Total Paid:

    $115 + $42

    = $157

    Last Payment:

    $350 - $157

    = $193


    Combining material

    Combining Material

    • You have $50,000 in the bank earning 8% simple interest. You plan to use this money to purchase a car with a down payment of $450. Will your monthly interest be enough to pay for the down payment?

      Simple Interest: I = Prt

      I = (50,000) (.08) (1/12)

      I = $333.33

      This will not be enough to cover the down payment.


    Combining material1

    Combining Material

    • You have $50,000 in the bank earning 5% simple interest. You plan to use this money to purchase a car with monthly payments of $200. Will your monthly interest be enough to pay your monthly payment?

      Simple Interest: I = Prt

      I = (50,000) (.05) (1/12)

      I = $208.33

      Your interest will be enough to cover your monthly payment.


    Combining material2

    Combining Material

    • You want to purchase a new couch. The You agree to an installment plan that requires a 10% down payment. If you purchase the couch by putting $87 down, how much did the couch cost?

      10% of what number is 87

      (0.10) x = 87

      x = 87 ÷ 0.10

      The couch cost a total of $870


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