Final answer:
After 6 years, the total amount paid for a $54,200 car loan at 15.1% interest compounded annually will be $109,113.84.
Step-by-step explanation:
Calculating Total Payment on a Compounded Car Loan
To calculate the total amount paid for a car after 6 years on a $54,200 loan at 15.1% interest compounded annually, we use the formula for compound interest:
A = P(1 + r/n)^(nt)
Where:
- A is the amount of money accumulated after n years, including interest.
- P is the principal amount (the initial amount of money).
- r is the annual interest rate (decimal).
- n is the number of times that interest is compounded per year.
- t is the time the money is invested for, in years.
For this particular loan:
- P = $54,200
- r = 15.1% or 0.151
- n = 1 (since it is compounded annually)
- t = 6 years
To find the total amount paid after 6 years, we'll plug these values into the formula:
A = $54,200(1 + 0.151/1)^(1*6)
A = $54,200(1 + 0.151)^6
A = $54,200(1.151)^6
A = $54,200 * 2.0132
A = $109,113.84
Therefore, after 6 years, the total amount paid for the car will be $109,113.84.