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Financial Algebra © Cengage/South-Western Slide 1 4-1 INTRODUCTION TO CONSUMER CREDIT Become familiar with the basic vocabulary of credit terms. Become familiar with types of lending institutions. Compute finance charges for installment purchases. OBJECTIVES
Financial Algebra © Cengage Learning/South-Western Slide 2 credit debtor creditor asset earning power credit rating credit reporting agency FICO score installment plan down payment interest finance charge Key Terms
Financial Algebra © Cengage Learning/South-Western Slide 3 Example 1 Heather wants to purchase an electric guitar. The price of the guitar with tax is $2,240. If she can save $90 per month, how long will it take her to save up for the guitar?
Financial Algebra © Cengage Learning/South-Western Slide 4 If Heather ’ s guitar costs x dollars and she could save y dollars per month, express algebraically the number of months it would take Heather to save for the guitar. CHECK YOUR UNDERSTANDING
Financial Algebra © Cengage Learning/South-Western Slide 5 Example 2 Heather, from Example 1, speaks to the salesperson at the music store who suggests that she buy the guitar on the installment plan. It requires a 15% down payment. The remainder, plus an additional finance charge, is paid back on a monthly basis for the next two years. The monthly payment is $88.75. What is the finance charge?
Financial Algebra © Cengage Learning/South-Western Slide 6 EXAMPLE 3 Carpet King is trying to increase sales, and it has instituted a new promotion. All purchases can be paid on the installment plan with no interest, as long as the total is paid in full within six months. There is a $20 minimum monthly payment required. If the Schuster family buys carpeting for $2,134 and makes only the minimum payment for five months, how much will they have to pay in the sixth month?
Financial Algebra © Cengage Learning/South-Western Slide 7 The Whittendale family purchases a new refrigerator on a no-interest-for-one-year plan. The cost is $1,385. There is no down payment. If they make a monthly payment of x dollars until the last month, express their last month ’ s payment algebraically. CHECK YOUR UNDERSTANDING
Consumer Credit Chapter 4.
4.1 Introduction to Consumer Credit
Financial Algebra © Cengage/South-Western Slide CREDIT CARD STATEMENT To identify and use the various entries in a credit card statement. OBJECTIVES.
OBJECTIVES 4-2 LOANS Read monthly payments from a table.
© 2012 Cengage Learning. All Rights Reserved. Principles of Business, 8e C H A P T E R 18 SLIDE Credit Fundamentals Cost of Credit.
Financial Algebra © 2011 Cengage Learning. All Rights Reserved. Slide SAVINGS ACCOUNTS Learn the basic vocabulary of savings accounts. Compute simple.
6-2 PAY PERIODS AND HOURLY RATES
Financial Algebra © Cengage/South-Western Slide CREDIT CARDS Become familiar with the basic vocabulary of credit cards. Compute an average daily.
OBJECTIVES 6-1 LOOK FOR EMPLOYMENT
Financial Algebra © Cengage/South-Western Slide CLASSIFIED ADS Compute the cost of classified ads for used cars. Compute the cost of sales tax on.
Financial Algebra © Cengage/South-Western Slide INTRODUCTION TO CONSUMER CREDIT Become familiar with the basic vocabulary of credit terms. Become.
6-5 SOCIAL SECURITY AND MEDICARE
6-3 COMMISSIONS, ROYALTIES, AND PIECEWORK PAY
Consumer Math p Definitions Down payment – part of the price paid at the time of purchase Financed – borrowed Mortgage – a property loan.
Financial Algebra © 2011 Cengage Learning. All Rights Reserved. Slide COMPOUND INTEREST FORMULA Become familiar with the derivation of the compound.
Back to Table of Contents pp Chapter 25 What Is Credit?
Financial Algebra © 2011 Cengage Learning. All Rights Reserved. Slide EXPLORE COMPOUND INTEREST Understand the concept of getting interest on your.
Comparison Shopping. Shopping Shopping is what you do when you spend income (money you have earned). You can do this in a variety of ways: a. In Store.
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