Question

Travis took out a six-year loan with a principal of $15,000. He made monthly payments of $225 for the entire period, at which point the loan was paid off. How much did Travis pay in interest?

a. $1,200
b. $1,350
c. $800
d. $0

Answer 1

To calculate this you need to multiply 225 by how many months,
6 * 12 = 72,
And so 225 * 72 = $16,200,

To find interest, minus the amount paid by the amount loaned:
16,200 - 15,000 = 1200, so the interest was $1200.

Hope this helps.

Answer 2

Interest = $1200

Explanation:

Time = 6 years

= 6 × 12 = 72 months

Monthly payment = $225

Total amount paid = Monthly payment × no. of months

= 225 × 72 = $16200

Now, using the formula :

Interest = Amount - Principal

= 16200 - 15000

= $1200

Hence, the interest paid by Travis = $1200