Question

If Ryan buys a car for $17,695 with a simple interest rate of 4.25%. How much interest will Ryan pay over 6 years?

A) $1,072.13
B) $3,197.50
C) $4,532.75
D) $6,395.25

Answer 1

Using the simple interest formula, Ryan will pay a total interest of $4,532.75 over 6 years at an annual simple interest rate of 4.25%. This corresponds to option C.

Step-by-step explanation:

To calculate the simple interest Ryan will pay over 6 years, we can use the simple interest formula: \(I = PRT\), where \(I\) is the interest, \(P\) is the principal amount, \(R\) is the interest rate per period, and \(T\) is the number of periods.

In Ryan's case:

• Principal \(P\) = $17,695
• Annual interest rate \(R\) = 4.25% or 0.0425 in decimal form
• Time \(T\) = 6 years

Plugging these values into the formula gives us:

\(I = $17,695 \times 0.0425 \times 6\)

\(I = $4,532.75\)

So, the total interest Ryan will pay over 6 years is $4,532.75, which corresponds to option C.