# Sara agrees to buy a car for a down payment of $3000 and payments of $315 per month for 4 years. If the interest rate is 4.25% per year, compounded monthly, what is the actual purchase price of the car?

##### 1 Answer

#### Explanation:

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Let the actual selling price after down payment be

Annual interest is

Split over 12 months this is

4 years is

So we have:

There is scope for a slight difference due to inherent errors in calculator algorithms.

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Due to anticipated errors in the calculator round this to: