Explanation:
To purchase $12,200 worth of restaurant equipment for her business, Linda made a down payment of $1600 and took out a business loan for the rest. After 3 years of paying monthly payments of $322.48, she finally paid off the loan.
(a) What was the total amount Linda ended up paying for the equipment
(including the down payment and monthly payments)?
How much on loan:
12,200 - 1,600 = $10,600 loan amount
How much paid on loan:
$322.48 * 3 years * 12 months = $11,608.28 amount paid on loan
Total paid:
= loan amount + amount paid on loan
$10,600 + $$11,608.28
= $22,208.28 paid overall
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(b) How much interest did Linda pay on the loan?
= loan amount - amount paid on loan
= $11,608.28 - $10,600
= $1,009.28 paid in interest