Question

Your new car has a listed price of $32,000. The loan you took out to buy the car charges 6% interest for the money you are borrowing. When you finish paying for the car, how much did you actually pay?

Answer 1

The total amount paid for the car, including interest, is $41,600.

Step-by-step explanation:

To calculate the total amount paid for the car, we need to consider the principal amount (listed price) as well as the interest charged on the loan. The formula to calculate the total amount paid is:

Total Amount Paid = Listed Price + Interest

Interest can be calculated using the formula:

Interest = Principal Amount × Interest Rate × Time

Plugging in the given values:

Principal Amount = $32,000

Interest Rate = 6% = 0.06

Time = Number of Years

Let's assume the loan term is 5 years. Calculate:

1. Interest = $32,000 × 0.06 × 5 = $9,600
2. Total Amount Paid = $32,000 + $9,600 = $41,600