Question

You purchase a car using a $20,000 loan with a 5% simple interest rate.(

a. suppose you pay the loan off after 4 years. how much interest do you pay on your loan? show yourwork and don’t forget the unit!(
b. suppose you pay the loan off after 3 years. how much interest do you save by paying the loan offsooner? show your work and don’t forget the unit.answer:
a.
b.

Answer 1

I=prt
I=20000*0.05*4
I=4000
2) I=20000*0.05*3
I=3000