Question

If you take out a loan that costs 561.60 over 35 months at an interest rate of 9% how much interest do you owe on the loan

Answer 1

Answer: $167.86

Explanation:

Assuming the rate is an annual rate. Convert it to a monthly rate:

= 9% / 12

= 0.75%

Use compound interest formula to find out the total owed:

= Amount * ( 1 + rate) ^ period

= 561.60 * ( 1 + 0.75%)³⁵

= $729.46

Interest = Total owed - cost of loan

= 729.46 - 561.60

= $167.86