Question

You owe $10,000 on a car loan. the bank charges a compound interest rate of 9.5% per year. if you don't make any payments on the loan, how much will you owe after 3 years? round your answer to the nearest whole cent.

a.$13,129.32
b.$14,376.61
c.$12,246.83
d.$11,990.25

Answer 1

Since you pay 9.5% extra per year, that is equal to 109.5% of last year, or 1.095 in decimal form The base equation: y=kax Sub in your values: y=10000×1.0953 Simply solve for that y=10000×1.0953y=10000×1.312932375y=13129.3 So you would owe $13129.30, after 3 years, given that you do not deposit any money over the course of that time