Answer:
$1,721.274
Explanation:
The amount paid as service charge is the difference between the total amount paid by Carlos on the loan and the total installment due.
Service charge = Amount paid - Total installment payment
The quarterly installment payment from the loan can be determined as follows:
Quarterly equal installment = Loan amount/Annuity factor
Quarterly interest rate = 5.49%/4 =1.3725%
Annuity factor = 1- (1+r)^(-n)/r
r =1.3725%,
n = 4×7 there are four quarters in a year
Annuity factor = (1- (1.013725)^(-4×7) )/0.01327)
= 23.1177
Quarterly installment payment interest
= 22,375/23.1177
= 967.87
Total amount paid in installment
= 967.871× 7 × 4
= 27,100.39518
Service charge = Amount paid - Total installment payment
$28,821.67 - 27,100.395
=$1721.274
