Question 4 • Applications and Modeling
After 30 of 48 payments, 18 payments remain, totaling 18 × $582.74 = $10,489.32. Under the actuarial method, discount those remaining payments at the monthly rate of 12% ÷ 12 = 1% to find the payoff balance: $582.74 × [1 − (1.01)⁻¹⁸] ÷ 0.01, which is about $9,555.73. The unearned interest is $10,489.32 − $9,555.73 = about $933.59, so the answer is $933.59.
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