Question

Will takes out a loan of $13,000 with a 4.3% interest rate that is compound semi-annually. If he pays off the load in 6yeafs, how much will he end up paying?

Answer 1

Will will end up paying $16,780.45 by the end of 6 years.

Explanation:

We are given the following in the question:

P = $13000

r = 4.3% = 0.04 3

t = 6 years

The compound interest is given by:

`A = p\bigg(1+(r)/(n)\bigg)^(nt)`

where A is the amount, p is the principal, r is the interest rate, t is the time in years and n is the nature of compound interest.

For n = 2

`A = 13000\bigg(1+(0.043)/(2)\bigg)^(12)\\\\A = \$16,780.45`

Will will end up paying $16,780.45 by the end of 6 years.