Question

Craig just purchased a new sports car. He financed $45,000 and must pay it back over 5 years with 11% interest. Hiw much will he have paid in interest by the time his car is paid off?

Answer 1

The amount Craig financed at the beginning(P) = 45000

Number of years he took to repay(T) = 5

Rate of interest(R) = 11%

Total interest he paid = $\frac{PTR}{100}$

$=\frac{45000(5)(11)}{100}$

= 450 × 55 = 24,750

Hence, interest paid by him by the time his car is paid off was $24750.