Question

You get a loan from the bank of 12,500 to buy a new car. they give you an interest rate of 8% for 5 years. how much total money must be paid at the end of the loan period.

Answer 1

To calculate the total amount that must be paid at the end of the loan period, you can use the formula: Total amount = Principal + Interest. In this case, the total amount is $17,500.

Step-by-step explanation:

To calculate the total amount that must be paid at the end of the loan period, we first need to calculate the interest on the loan. The formula to calculate simple interest is: Interest = Principal x Rate x Time. In this case, the principal is $12,500, the rate is 8% (or 0.08), and the time is 5 years.

Interest = $12,500 x 0.08 x 5 = $5,000.

The total amount that must be paid at the end of the loan period is the sum of the principal and the interest. So, Total amount = Principal + Interest = $12,500 + $5,000 = $17,500.