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Jerry Buys a $2,700 Motorcycle on a Deferred Payment Plan

Question 15

Multiple Choice

Jerry buys a $2,700 motorcycle on a deferred payment plan.There is no down payment and no interest for 18 months.Jerry must make a minimum payment of $75 a month.To avoid a retroactive APR of 21%,he must pay the balance in full before the 18 months has passed.If he pays $75 each month,how much should he pay the last month to avoid the interest charges?


A) $1,350
B) $1,425
C) $1,500
D) $2,075

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