### 13-3: TEKS Practice

• 1. Joshua is using an online loan calculator to find the fixed payment needed to pay off a \$29,000 loan with 8% annual interest in 6 years. Complete the table with the appropriate information. • 2. A \$5,800 credit card loan with 15.5% interest can be paid off in 3 years with monthly payments of \$202.48.

• a. What is the total amount repaid?

• b. What is the cost of credit?

• 3. The table shows the minimum monthly payments needed to pay off a \$2,800 credit card loan with 16.5% annual interest over different lengths of time. How does paying off a credit card loan in 4 years instead of 2 years change the cost of credit? • 4. Is the loan described a credit card loan or an easy access loan? • 5. Julia's family needs an easy-access loan for \$630 to fix their bathroom. The loan has a 436% annual interest rate. The interest period is two weeks. What is the cost of credit if Julia's family pays the loan off over eight weeks? Round to the nearest cent.

• 6. Aiden's family needs a \$600 easy-access loan to fix their bathtub. They can repay the loan in eight weeks. Which of these loans results in a lower cost of credit? How much lower is the cost of credit? Select the correct choice below and, if necessary, replace the box to complete your choice. • A. The loan that charges 13.7% interest every two weeks costs \$▪ more than the loan that charges 6.6% interest each week.

• B. The loan that charges 13.7% interest every two weeks costs \$▪ less than the loan that charges 6.6% interest each week.

• C. The loan that charges 13.7% interest every two weeks costs the same as the loan that charges 6.6% interest each week.

• 7. Reasoning A \$7,300 credit card loan with 13.75% annual interest is paid off in 6 years with monthly payments of \$149.45.

• a. What is the cost of credit for the loan?

• b. How would the cost of credit for the loan change if the loan term were increased to 7 years? Explain how you can answer this without doing any calculations.

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