If a plumber's monthly car payment is $250, and $225 goes to the principal, what percent is allocated to interest?

Prepare for the ASVAB MEPS Exam with flashcards and multiple choice questions, each with hints and explanations. Get exam-ready today!

To determine the percentage of the monthly car payment that is allocated to interest, you first need to understand the structure of the payment. In this case, the plumber’s monthly car payment is $250, and out of this amount, $225 is applied to the principal.

To find out how much is allocated to interest, subtract the amount going to the principal from the total monthly payment.

$250 (total payment) - $225 (principal) = $25 (interest).

Next, to find what percentage the interest payment represents of the total monthly payment, you divide the interest amount by the total payment and then multiply by 100 to convert it into a percentage:

[

\text{Interest Percentage} = \left(\frac{\text{Interest}}{\text{Total Payment}}\right) \times 100 = \left(\frac{25}{250}\right) \times 100 = 10%

]

This calculation shows that 10% of the plumber's monthly car payment goes towards interest. Therefore, the correct answer is the option that states 10%.

Subscribe

Get the latest from Examzify

You can unsubscribe at any time. Read our privacy policy