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Deferred Payment vs. Cash Price: Calculation & Interest

Instructions:

Choose an answer and hit 'next'. You will receive your score and answers at the end.

question 1 of 3

An electronics item has a price tag of $59. What is the cash price of this item?

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1. A deferred payment plan wants you to make 12 monthly payments to pay off an item that costs $500. What is the basic monthly payment before interest is included?

2. Adriana bought a bicycle at $300 on a deferred payment plan with an annual interest rate of 20 percent and 12 monthly payments. Calculate her repayment for the first month.

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About This Quiz & Worksheet

In this quiz, you will be assessed on your ability to use what you've learned to solve problems that ask you to calculate cash price and deferred payment.

Quiz & Worksheet Goals

Use this quiz and worksheet to test your ability to:

  • Calculate the cash price of an item
  • Determine the monthly payment before interest in a deferred payment plan
  • Find the least expensive payment options in real-life scenarios

Skills Practiced

  • Making connections- use understanding of the concept payment options and their costs
  • Problem solving - use acquired knowledge to calculate the cash price of an item
  • Knowledge application- use your knowledge to answer a question that asks you to calculate a monthly payment before interest on a deferred payment plan

Additional Learning

Review the lesson titled Deferred Payment vs. Cash Price: Calculation & Interest to get more details on this financial topic. These are some objectives it covers:

  • Define cash price
  • Distinguish between cash price and deferred payment
  • Identify the benefits of deferred payments
  • Name the pros and cons of cash price
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