Answered

Kelly purchased a toaster for $180. She made a down payment of 25% and financed the rest for 12 months with payments of $17.58.


Find (a) the downpayment and (b) the total installment price of the toaster?

Answer :

Answer:

Down-payment is $45

Total installment price is $255.96

Explanation:

The down payment on the toaster can be calculated as 25% of the purchase price i.e 25%*$180=$45

Installment price is given as =down-payments plus all installment payments.

Installment payments =$17.58*12

Installment payments=$210.96

Total installment price=$210.96 +$45

Total installment price=$255.96

The installment payment comes with ease of paying over 12 months without having to part with a large amount  at every point in time, as well as the ability to acquire asset without the need to make full payment initially.

Overall, the installment payment is more expensive as additional $75.96($255.96-$180) over and above the outright cash price.