Respuesta :
The annual percentage rate is the interest rate for payment for the car
loan.
- The mount owed on the car with an APR of 3.1% is approximately $8,693.08.
- The mount owed on the car with an APR of 7% is approximately $17,310.92.
The given parameters are;
The amount of loan Terry and Jim have = $26,004
The annual percentage rate (APR) on one loan = 3.1 %
The annual percentage rate (APR) on the other loan = 7 %
Total interest paid after one year = $1,481.25
Required:
The amount owed on each car
Solution:
Let X represent the loan, with 3.1% APR, we have;
The other loan with 7% APR = 26,004 - X
Therefore;
0.031·X + 0.07·(26,004 - X) = 1,481.25
0.031·X + 1,820.28 - 0.07·X = 1,481.25
1,820.28 - 1,481.25 = 0.07·X - 0.031·X = 0.039·X
339.03 = 0.039·X
- [tex]X = \dfrac{339.03}{0.039} \approx 8693.08[/tex]
Therefore;
- The amount owed on the car with an APR of 3.1%, X ≈ $8,693.08
Therefore;
The amount owed on the car with an APR of 7% ≈ 26,004 - 8693.08 =
17310.92.
- The amount owed on the car with an APR of 7% ≈ $17,310.92
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