If a musician uses his credit card to pay for a new violin that costs $2,900 and does not pay on it until the second month, what will the 3.35% monthly interest charge be at the end of the first month? show your work or explain how you got your answer. calculate the total payback for a $3,500 loan at 8% annual interest with monthly payments for two years. show all of your steps. use the formula, m = pm(1 + m)^na/(1 + m)^na - 1, as needed.

Solution:

1.  Cost of a new Violin that is bought by the musician = $ 2900

Monthly interest charge = 3.35 %

If you will find the compound interest or simple interest for a month, they both will be same for a month.

Simple interest =

Interest paid at the end of first month = $ 97.15

2. Loan Amount = $ 3,500

Annual interest = 8 %

Time period = 2 years= 24 months

As , we have to find the  total payback  for two years, at 8% annual interest with monthly payments .we will use the formula of Amount in terms of compound interest here.

Formula for Amount

Amount=

Total payback after 2 years = $ 4098.58

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step-by-step explanation: