Installment Price

Question

1. The Morrison family bought a car for $24,000 which was financed at $600 per month for 40 months. The down payment was $5000.

a. What is the Installment Price? (5 Points)

b. What is the financial charge and amount financed? (5 Points)

 2. Jason’s credit card’s beginning unpaid balance for August is $3,000. During the August billing cycle he made a payment of $250 and used card to purchase $75 worth of groceries. Credit card charges 23% annual percentage rate and uses the unpaid balance method.

a. What is the finance charge at the end of August? (5 Points)

b. What is the new balance at the end of August? (5 Points)

Question

The day after a snowstorm, cars arrive at Mel’s Auto Wash at an average rate of 10 per hour according to a Poisson process. The automated car washing process takes exactly 5 minutes from start to finish. 

a. What is the probability that an arriving car will find the car wash empty? 

b. On average, how many cars are waiting for service? 

c. On average, what is the total length of time (from arrival to departure) that cars will spend at the car wash?