Chloe Closson paid for her vacation to the mountains with a $3,000 installment loan at 10% for 12 months. Her monthly payments were $263.75. After five payments, the balance due was $1,786.20. If Chloe pays off the loan with the sixth payment, how much will she save?

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Business

Franco Orozco

14 July, 05:09

Chloe Closson paid for her vacation to the mountains with a $3,000 installment loan at 10% for 12 months. Her monthly payments were $263.75. After five payments, the balance due was $1,786.20. If Chloe pays off the loan with the sixth payment, how much will she save?

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Answers (1)

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Kelly Park · Answer 1

If Chloe did not pay off the loan, she will payout 263.75 x 12 = $3165.00

However, if Chloe pays off the loan with the sixth payment, she will pay out (263.75 x 5) + 1,786.20 = $3,086.95.

But the question is how much will she save? To get the answer just follow this: 3165.00 - 3086.95 = $78.05

Therefore, Chloe saves $78.05