Lush Gardens bought a new truck for $73,000. It paid $8,000 as a down payment and...

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Lush Gardens bought a new truck for $73,000. It paid $8,000 as a down payment and financed the balance at 5.00% compounded mo

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Answer 1

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Cost of truck = $ 73000
Down payment = $ 8000
The balance that is to be paid = $ 73000 - $ 8000 = $ 65000
The interest rate to ne applied = 5 % compounded monthly

Interest rate per month = 5 % / 12 = 0.4167 %
The payments made at the end of every month = $ 1625

The number of months required to clear the loan of $ 65000

Present Value = PV = $ 65000
Future Value = FV = $ 0
Payment = PMT = $ 1625
Interest rate = I/Y = 0.4167 %
Number of periods ( months) = N = 43.85 months ~ 44 months

Therefore the number of monthly payments to pay of the loan = 44 months

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Answer 2

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Lush Gardens bought a new truck for $73,000. It paid $8,000 as a down payment and...

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