Aerotron Electronics has just bought a used delivery truck for $15,000. The small business paid $1,000 down and financed the rest, with the agreement to pay nothing for the entire first year and then to pay $576.83 at the end of each month over years 2, 3, and 4 (first payment is in 13th month). a. What nominal interest rate is Aerotron paying on the loan? % b. What effective interest rate are they paying? % Round your answer to 4 decimal places for a and b. The tolerance is ± 0.0005. c. How much of the 14th month's payment is interest? How much is principal? payment interest = $ , and principal = $ d. How much of the 18th month's payment is interest? How much is principal? payment interest = $ , and principal = $ e. How much of the 22nd month's payment is interest? How much is principal? payment interest = $ , and principal = $ Round your answers to the nearest whole dollar for c-e. The tolerance is ± 5.
Aerotron Electronics has just bought a used delivery truck for $15,000. The small business paid $1,000 down and financed the rest, with the agreement to pay nothing for the entire first year and then to pay $576.83 at the end of each month over years 2, 3, and 4 (first payment is in 13th month). a. What nominal interest rate is Aerotron paying on the loan? % b. What effective interest rate are they paying? % Round your answer to 4 decimal places for a and b. The tolerance is ± 0.0005. c. How much of the 14th month's payment is interest? How much is principal? payment interest = $ , and principal = $ d. How much of the 18th month's payment is interest? How much is principal? payment interest = $ , and principal = $ e. How much of the 22nd month's payment is interest? How much is principal? payment interest = $ , and principal = $ Round your answers to the nearest whole dollar for c-e. The tolerance is ± 5.
Chapter19: Lease And Intermediate-term Financing
Section: Chapter Questions
Problem 19P
Related questions
Question
![Aerotron Electronics has just bought a used delivery truck for $15,000. The small business paid
$1,000 down and financed the rest, with the agreement to pay nothing for the entire first year and
then to pay $576.83 at the end of each month over years 2, 3, and 4 (first payment is in 13th
month).
a. What nominal interest rate is Aerotron paying on the loan?
%
b. What effective interest rate are they paying?
%
Round your answer to 4 decimal places for a and b. The tolerance is ± 0.0005.
c. How much of the 14th month's payment is interest? How much is principal?
payment interest = $
, and principal = $
d. How much of the 18th month's payment is interest? How much is principal?
payment interest = $
, and principal = $
e. How much of the 22nd month's payment is interest? How much is principal?
payment interest = $
, and principal = $
Round your answers to the nearest whole dollar for c-e. The tolerance is ± 5.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Ffd988327-d2ff-4971-a99e-bef2e7d2c1a8%2Ff2008e19-a63a-494b-ae9e-15eb397c36ad%2Fij2hnce_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Aerotron Electronics has just bought a used delivery truck for $15,000. The small business paid
$1,000 down and financed the rest, with the agreement to pay nothing for the entire first year and
then to pay $576.83 at the end of each month over years 2, 3, and 4 (first payment is in 13th
month).
a. What nominal interest rate is Aerotron paying on the loan?
%
b. What effective interest rate are they paying?
%
Round your answer to 4 decimal places for a and b. The tolerance is ± 0.0005.
c. How much of the 14th month's payment is interest? How much is principal?
payment interest = $
, and principal = $
d. How much of the 18th month's payment is interest? How much is principal?
payment interest = $
, and principal = $
e. How much of the 22nd month's payment is interest? How much is principal?
payment interest = $
, and principal = $
Round your answers to the nearest whole dollar for c-e. The tolerance is ± 5.
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