Solve the problem and use the table to find the annual percentage rate.
-An appliance store offers a refrigerator for $1,200 with no down payment, $145.68 in finance charges and 24 equal payments. Find the annual percentage rate.

Question

Solve the problem and use the table to find the annual percentage rate.  
-An appliance store offers a refrigerator for $1,200 with no down payment, $145.68 in finance charges and 24 equal payments. Find the annual percentage rate.

Quizplus · Accepted Answer

To find the annual percentage rate, we need to use the following formula:

APR = ((total finance charges / amount financed) / number of payments) * 12 * 100

In this case, the amount financed is $1,200, and the total finance charges are $145.68. The number of payments is 24.

APR = ((145.68 / 1200) / 24) * 12 * 100 = 11.25%

Therefore, the annual percentage rate is 11.25%. The best choice is B) as it is the only option that matches the calculated APR.

Solve the Problem and Use the Table to Find the Annual