Respuesta :

The first step to calculate the APR is to calculate the interest rate per $100

Here Interest rate = 11%

Term or time of repayment = 18 months

interest per $100 =

$100 × 11% × [tex] \frac{18}{12} [/tex]

= $16.50

Now we should calculate the interest part for $3400 for 18 months

[tex] \frac{3400}{100} [/tex] × [tex] \frac{16.50}{18} [/tex]

= $31.12

So $ 31.17 is the interest part of the repayment amount

Now lets calculate the principal part which would be $ 3400 divided equally for 18 months

[tex] \frac{3400}{18} = $188.89 [/tex]

Now to find the final payment we add the interest and the principal part

$31.17+$188.89 = $220.06

Hence option D is the right answer

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