Answer:
Total interest cost = $475.04
Explanation:
given data
Principal = $13,500
Interest Rate = 8%
Time = 240 days
solution
we get On 100th day interest that is
interest = principal × rate × time ...................1
put here value
interest = 13500 × 0.08 × [tex]\frac{100}{360}[/tex]
interest = $300
and
Total amount after paying 6,600 is
amount after 6,600 = interest + principal - 6600
amount after 6,600 = 300 + 13500 - 6600
amount after 6,600 = $7200
and
On 180th day interest that is
interest = $7200 × 0.08 × [tex]\frac{180}{360}[/tex]
interest = $128
and
on 240th day Principal amount will be
Principal amount = 7200 + 128 - 3800
Principal amount = $3528
so now
interest will be for 60 day
Interest = $3528 × 0.08 × [tex]\frac{60}{360}[/tex]
Interest = $47.04
so Total interest cost till 240 days will be
Total interest cost = $300 + $128 + $47.04
Total interest cost = $475.04
