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1000 ps section#3- 16

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by sky828i » Tue Sep 04, 2007 11:32 am
16. A family made a down payment of $75 and borrowed the balance on a set of encyclopedias that cost $400. The balance with interest was paid in 23 monthly payments of $16 each and a final payment of $9. The amount of interest paid was what percent of the amount borrowed?
(A) 6%
(B) 12%
(C) 14%
(D) 16%
(E) 20%

answer is d
can anyone explain?
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Source: — Problem Solving |

1000 ps section#3- 16

by wizardofwashington » Tue Sep 04, 2007 11:59 am
Amount borrowed = 400-75 = 325
Total Paid by installments = 23x16 + 9= 368+9 = 377
Interest Paid = Total Paid - Amount Borrowed = 377-325 = 52

Now, the amount of interest paid compared to the amount borrowed = 52/325=.16 = 16%

HENCE, THE ANSWER IS "D"
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