math question need help

dmillionaire

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Carmella purchased a refrigerator under a conditional sale contract that required 30 monthly payments of $63.06 with the first payment due on the purchase date. The interest rate on the outstanding balance was 18% compounded monthly.(Round to the nearest cent.)
a. What was the purchase price of the refrigerator?


i cant seem to find the answer to this question for some reason

ive tried this

i= 18/12 =1.5 = 0.015

n = 29 month

fv = 63.06 ( (1+0.015)^29 -1 / 0.015 ) = 2270.078 + 63.06 = 2331.14


i must be making a simple mistake
 
Carmella purchased a refrigerator under a conditional sale contract that required 30 monthly payments of $63.06 with the first payment due on the purchase date. The interest rate on the outstanding balance was 18% compounded monthly.(Round to the nearest cent.)
a. What was the purchase price of the refrigerator?


i cant seem to find the answer to this question for some reason

ive tried this

i= 18/12 =1.5 = 0.015

n = 29 month

fv = 63.06 ( (1+0.015)^29 -1 / 0.015 ) = 2270.078 + 63.06 = 2331.14


i must be making a simple mistake

I'd look at the total amount paid and set that equal to the price compounded by the interest.

T = (price)(1+i/12)30

Do you see where this comes from? The 30 is from 30 months, the i/12 is because it's i% a year compounded monthly.

See if you can plug the numbers in and solve for price.
 
I'd look at the total amount paid and set that equal to the price compounded by the interest.

T = (price)(1+i/12)30

Do you see where this comes from? The 30 is from 30 months, the i/12 is because it's i% a year compounded monthly.

See if you can plug the numbers in and solve for price.


what is price there cuz that = (63.06)(1.015)^30 = 98.57 ??? which definitely isnt the correct answer
 
also im pretty sure the question says that the first month is paid without interest and the rest of the 29 month is 18% compounded monthly
 
If you're a millionaire, why do you care ? :rolleyes:

You used this:
"fv = 63.06 ( (1+0.015)^29 -1 / 0.015 ) = 2270.078 + 63.06 = 2331.14"
That's the future value formula; how much accumulates (in a savings account as example)
if 63.06 is deposited monthly, at monthly rate of 1.5% (18 annual)

You need to use the Present Value formula...in other words, today's Value,
which becomes what's paid for that icebox...ok?

Want to try it? You should get $1,537.15


lolll oooo **** i dont know why i didnt try that i just assumed i was looking for the future value of the fridge 30 month from now imma try that right now!
thank u dennis u always here to save me haha
 
What that does is give you the future value of 63.06 30 months later using rate of 1.5% monthly.
Has NOTHING to do with your problem. Make sure you understand that before trying other problems.

Wanna make a deal?
STOP using chat-language like "cuz" (should be "because") and "u" (should be "you") and we'll
keep helping you. OK?
You won't regret it...plus you'll have a much better chance applying for a job...get my drift?
...unless you're ok with a career flipping burgers for Burger King :rolleyes:

haha **** i should've know the spelling police where everywhere :p Okie i shall talk with the most appropriate tone and volume and pronunciation of talking one has ever herd in the depth of the math forums.

i need help on that other question though, about effective rate, i couldn't figure out the formula i think you can only find it with a calculator, i also tried punching in the answer you gave for the question and they weren't correct, unless the answer is 6.78 or something precise.

also i doubt id ever have a burger flipping job lol i already own my own business selling music online i know a lot about selling and driving in customers promotion, i have trouble with the math part.

i appreciate your help though
 
haha **** i should've know the spelling police where everywhere :p Okie i shall talk with the most appropriate tone and volume and pronunciation of talking one has ever herd in the depth of the math forums.

i need help on that other question though, about effective rate, i couldn't figure out the formula i think you can only find it with a calculator, i also tried punching in the answer you gave for the question and they weren't correct, unless the answer is 6.78 or something precise.

also i doubt id ever have a burger flipping job lol i already own my own business selling music online i know a lot about selling and driving in customers promotion, i have trouble with the math part.

i appreciate your help though
I think you are not getting what we have been saying. Solving for i in some financial formulas cannot be done algebraically. It can be done approximately by using iterative methods of approximation, and a good financial calculator will do the approximation for you.
 
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