Question

Please Help! I'll give a lot of points!

Find the simple interest Jolie owes on a 2-year loan for $9,500 to buy a used car at the rate of 9% interest.

This is a TWO part question, make sure to answer both part A. and B.

A. Find the amount of interest. Show the math computation use to find the amount of interest.

B. What was the monthly payment? Show the work used to find this answer.

Answer 1

• Principle=P=9500
• Time=T=2yrs
• Rate of interest=9%
• Interest be I

So

`\\ \rm\rightarrowtail I=(PRT)/(100)`

`\\ \rm\rightarrowtail I=(9500(2)(9))/(100)`

`\\ \rm\rightarrowtail I=95(18)`

`\\ \rm\rightarrowtail I=\$ 1710`

#B

Total months=24

Monthly payment:-

• Principle+Interest/months
• 9500+1710/24
• 11210/24
• 467.08≈467$

Answer 2

A. Interest = $1710

B. Monthly payment = $467.08

Explanation:

Simple interest formula:

`\sf A = P(1+rt)`

where:

• A = final amount
• P = principal
• r = annual interest rate (in decimal form)
• t = time (in years)

Given:

• P = $9,500
• r = 9% = 0.09
• t = 2 years

Substitute given information into the formula:

`\begin{aligned} \sf \implies A & = \sf 9500(1+0.09 \cdot 2)\\& = \sf 11210 \end{aligned}`

Interest = final amount - principal

= 11210 - 9500

= $1710

term = 2 years

1 year = 12 months

⇒ term = 2 × 12 = 24 months

Monthly payment = final amount ÷ months in term

= 11210 ÷ 24

= $467.08