Flat rate interest of a loan on a car

Question

What is the flat rate of interest per annum if a car is $15790 and is paid with a $500 deposit and $92 per week over 5 years?

Answer 1

If they pay $92 per week for 5 years, that's 92 * 5 * 52 for total weekly payments.  That's $23920.  Then add the $500 deposit for total payments of $24420.

 

Since the car cost $15790, then everything over that amount is interest.  That 24420 - 15790 = 8630.

 

Since that interest is paid over 5 years, the interest per year is 8630 / 5 = 1726.

 

Since the cost of the car is 15790, the flat annual interest rate is the annual interest divided by the cost, which is 1726 / 15790 = 0.109, or 10.9%.