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    Present Value of Annuity and Amorization

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    An auto stereo dealer sells a stereo system for $600.00 down and monthly payments of $30.00 for the next 3 years. If the interest rate is 1.25% per month on the unpaid balance, find:

    A.) The cost of the stereo system;
    B.) The total amount of interest paid.

    Please show formula used. And the list of steps used to find the solution. Thanks.

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    https://brainmass.com/business/annuity/present-value-annuity-amorization-189669

    Solution Preview

    An auto stereo dealer sells a stereo system for $600.00 down and monthly payments of $30.00 for the next 3 years.  If the interest rate is 1.25% per month on the unpaid balance, find

    a.) the cost of the stereo system;
    b.) the total amount of interest ...

    Solution Summary

    Given the monthly payments and the down payment, the solution calculates the cost of the stereo system and the total amount of interest paid.

    $2.19

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