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?
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.
Due to anticipated errors in the calculator round this to: