Question

Sam borrowed 15,575$ to purchase a car. Bank is charging him 21% for a 5 year loan. At the end of the 5 years, how much will sam have paid for the car and interest?

Answer 1

Explanation:

We would apply the formula for determining simple interest which is

expressed as

I = PRT/100

Where

P represents the principal

R represents interest rate

T represents time in years

I = interest after t years

From the information given

T = 5 years

P = $15,575

R = 21%

Therefore

I = (15575 × 21 × 5)/100

I = 16353.75

Interest paid is $16353.75

Total amount that Sam would have paid for the car would be

16353.75 + 15575. = $31928.75