A car dealer carries out the following calculations. List price Options Destination charges $ 15,428.00 $ 3,625.00 $ 350.00 $ 19,403.00 $ 1,164.18 $ 7,950.00 $ 12,617.18 $ 3,532.81 $ 16,149.99 Subtotal Тах Less trade-in Amount to be financed 7% interest for 48 months Total ΜΟΝΤΗLY PAYΜΕΝT $ 336.46 What is the annual percentage rate? (Rour your answer to one decimal place.) %
A car dealer carries out the following calculations. List price Options Destination charges $ 15,428.00 $ 3,625.00 $ 350.00 $ 19,403.00 $ 1,164.18 $ 7,950.00 $ 12,617.18 $ 3,532.81 $ 16,149.99 Subtotal Тах Less trade-in Amount to be financed 7% interest for 48 months Total ΜΟΝΤΗLY PAYΜΕΝT $ 336.46 What is the annual percentage rate? (Rour your answer to one decimal place.) %
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![### Car Financing Calculation Example
**Scenario:**
A car dealer carries out the following calculations:
**Costs and Payments:**
- **List price**: $15,428.00
- **Options**: $3,625.00
- **Destination charges**: $350.00
**Subtotal Calculation:**
- **Subtotal**: $19,403.00 (Sum of List price, Options, and Destination charges)
**Additional Costs:**
- **Tax**: $1,164.18
**Trade-In Value:**
- **Less trade-in**: $7,950.00
**Financing Details:**
- **Amount to be financed**: $12,617.18 (Subtotal + Tax – Trade-in value)
- **Interest**: 7% interest for 48 months = $3,532.81
- **Total**: $16,149.99 (Amount to be financed + Interest)
- **Monthly Payment**: $336.46
**Question:**
What is the annual percentage rate? (Round your answer to one decimal place.)
**Answer Box:**
\[ \boxed{\_\_\_\_\_\_\_%} \]
### Explanation
- The list price is the initial cost of the car.
- Options are additional features selected by the buyer.
- Destination charges cover the cost of delivering the car to the dealer.
- The subtotal is the sum of the list price, options, and destination charges.
- Tax is calculated based on the subtotal and added to it.
- The trade-in value is the amount the dealer agrees to pay for the buyer's old car, which is subtracted from the subtotal plus tax to get the amount to be financed.
- The interest calculation is based on financing terms (7% for 48 months).
- The total amount to be paid includes the principal amount to be financed plus the interest.
- Monthly payments are calculated based on the total amount divided by the financing period (48 months).
Understanding these calculations is crucial for budgeting and financial planning when purchasing a car.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F373e3400-461c-4f07-afaf-9f92fd60170d%2F3234f3dc-0b88-42c3-ac19-6cbadf5a4a9f%2F84rntwl_processed.png&w=3840&q=75)
Transcribed Image Text:### Car Financing Calculation Example
**Scenario:**
A car dealer carries out the following calculations:
**Costs and Payments:**
- **List price**: $15,428.00
- **Options**: $3,625.00
- **Destination charges**: $350.00
**Subtotal Calculation:**
- **Subtotal**: $19,403.00 (Sum of List price, Options, and Destination charges)
**Additional Costs:**
- **Tax**: $1,164.18
**Trade-In Value:**
- **Less trade-in**: $7,950.00
**Financing Details:**
- **Amount to be financed**: $12,617.18 (Subtotal + Tax – Trade-in value)
- **Interest**: 7% interest for 48 months = $3,532.81
- **Total**: $16,149.99 (Amount to be financed + Interest)
- **Monthly Payment**: $336.46
**Question:**
What is the annual percentage rate? (Round your answer to one decimal place.)
**Answer Box:**
\[ \boxed{\_\_\_\_\_\_\_%} \]
### Explanation
- The list price is the initial cost of the car.
- Options are additional features selected by the buyer.
- Destination charges cover the cost of delivering the car to the dealer.
- The subtotal is the sum of the list price, options, and destination charges.
- Tax is calculated based on the subtotal and added to it.
- The trade-in value is the amount the dealer agrees to pay for the buyer's old car, which is subtracted from the subtotal plus tax to get the amount to be financed.
- The interest calculation is based on financing terms (7% for 48 months).
- The total amount to be paid includes the principal amount to be financed plus the interest.
- Monthly payments are calculated based on the total amount divided by the financing period (48 months).
Understanding these calculations is crucial for budgeting and financial planning when purchasing a car.
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