Question

your $54,200 2- year car loan is at 15.1% compounded annually. what will you have paid for your car after 2 years

Answer 1

Express the formula for compound interest.

`A=P(1+(r)/(n))^(nt)`

Given that, P is 54200, r is 0.151, n is 1( Since, compounded annulaly) and t is 2.

Therefore, the total amount paid after two years is,

`\begin{gathered} A=54200(1+(0.151)/(1))^2 \\ =71804.2 \end{gathered}`

Therefore, the total amount paid after two years is 71804.2 dollar.