Answer:
After Mr. White makes the 12 monthly payments, he will have to make a final payment of $560.
If Mr. White defaults on his payments, he will have to pay additional interest on late fees and penalties, face credit and legal problems, collectors, etc...
Step-by-step explanation:
First, we are going to find how much he has payed after 12 months of monthly payments. We know that Mr. White needs to pay $120 per month for 12 month, so to find the total amount he has payed, we just need to multiply the monthly payment by the number of months:
Total = 12 x $120
Total = $1,440
Now, we know that the purchase price of the TV is $2,000. Since he has already paid $1,400, his final payment can be calculates by subtracting $1,440 from the purchase price of the TV;
Final payment = $2,000 - $1,440
Final payment = $560
We can conclude that after Mr. White makes the 12 monthly payments, he will have to make a final payment of $560.
Now, If Mr. White defaults on his payments, he will have to pay additional interest on late fees and penalties, face credit and legal problems, collectors, etc...
Answer:
1,440
pay a high finance charge on the outstanding balance
