Give the step-by-step reasoning process and then the final answer. Aaron wants to purchase a guitar under a payment plan of $100.00 per month for 12 months. His father has agreed to lend him the entire amount for the guitar, plus a one-time 10% interest fee for the entire loan. With interest, how much money will Aaron owe his dad?
The guitar costs $100 every month for 12 months so it costs 100 * 12 = $1200. His dad is charging him 10% interest on the $1200 so interest comes to .10 * 1200 = $120.00. All total, Aaron will owe his father the price of the guitar, $1200 and the interest, $120 so 1200 + 120 = $1,320.00.
The final answer: 1320.