2) Tom purchases a professional racing bicycle that sells for 4,000 , including tax. It requires a 300 down payment. The remainder, plus a finance charge, is paid back monthly over the next 2(1)/(2) years. The monthly payment is 132.75 What is the finance charge?

## Step 1: Calculate the loan amount### The bicycle costs 300. So, the loan amount is 300 = 132.75 monthly for years, which is equivalent to 30 months (2.5 years * 12 months/year). Therefore, the total amount paid is 3982.50.## Step 3: Calculate the finance charge### The finance charge is the difference between the total amount paid and the loan amount. So, the finance charge is 3700 = $282.50.