Because of a job change, Seth Armstrong has just relocated to the southeastern United States. He sold his furniture before he moved, so he's now shopping for new furnishings. At a local furniture store, he's found an assortment of couches, chairs, tables, and beds that he thinks would look great in his new two-bedroom apartment; the total cost for everything is $6,400. Because of moving costs, Seth is a bit short of cash right now, so he's decided to take out an installment loan for $6,400 to pay for the furniture. The furniture store offers to lend him the money for 48 months at an add-on interest rate of 6.5 percent. The credit union at Seth's firm also offers to lend him the money - they'll give him the loan at an interest rate of 10 percent simple, but only for a term of 24 months. Compute the monthly payments for the loan from the furniture store. Round the answer to the nearest cent. $ per month Compute the monthly payments for the loan from the credit union. Round the answer to the nearest cent. $ per month Determine the APR for the loan from the furniture store. Round the answer to 2 decimal places. % Determine the APR for the loan from the credit union. Round the answer to 2 decimal places. % Which is more important: low payments or a low APR?
Because of a job change, Seth Armstrong has just relocated to the southeastern United States. He sold his furniture before he moved, so he's now shopping for new furnishings. At a local furniture store, he's found an assortment of couches, chairs, tables, and beds that he thinks would look great in his new two-bedroom apartment; the total cost for everything is $6,400. Because of moving costs, Seth is a bit short of cash right now, so he's decided to take out an installment loan for $6,400 to pay for the furniture. The furniture store offers to lend him the money for 48 months at an add-on interest rate of 6.5 percent. The credit union at Seth's firm also offers to lend him the money - they'll give him the loan at an interest rate of 10 percent simple, but only for a term of 24 months.
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Compute the monthly payments for the loan from the furniture store. Round the answer to the nearest cent.
$ per month
Compute the monthly payments for the loan from the credit union. Round the answer to the nearest cent.
$ per month
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Determine the APR for the loan from the furniture store. Round the answer to 2 decimal places.
%
Determine the APR for the loan from the credit union. Round the answer to 2 decimal places.
%
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Which is more important: low payments or a low APR?
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