Final answer:
The APR with semi-annual compounding can't be calculated without more details. To find the total interest paid over five years, one could use an amortization schedule assuming the APR is known, which would illustrate the distribution of interest and principal for each payment throughout the loan term.
Step-by-step explanation:
To calculate CIBC's Annual Percentage Rate (APR) with semi-annual compounding, we need additional information like the total payment amount over the life of the loan or the specific formula that CIBC uses for interest calculation. However, I can help you understand how you would approach determining the total interest paid in the first five years once you have the APR. To estimate the total interest paid in the first five years, you could use the loan's amortization schedule, which breaks down each payment into the portion that goes towards interest and the portion that goes towards paying down the principal.
With an APR and compounding frequency, you would establish the periodic interest rate and then apply it to the outstanding balance for each payment period. Typically, earlier payments in a loan's life will have a higher interest component than principal component. As an example, with a simple interest loan of $10,000 at an interest rate of 5% for 3 years, you'd calculate total interest like this: Total future amount (with simple interest) = $100 + ($100 × 0.05 × 3) = $115 .Compound interest, on the other hand, adds accumulated interest into the principal when calculating future interest.