Noel Devine bought a new dishwasher for $320. He paid $20 down and made 10 monthly payments of $34. The actual yearly interest rate that paid was 14.55%.

Solution: Downpayment + Monthly payment x number of installments = 20 + (34 * 10 ) = 20 + 340 = 360 Interest = 360 - 320 = 40 r = i * 100/ P * nr r = 40 * 100 / 320 * 10/12 r = 4000/266 2/3 = 14.55%