Question

Jerry’s loan had a principal of $22,000. He made quarterly payments of $640 for nine years until the loan was paid in full. How much did Jerry pay in interest? a. $3,120 b. $1,040 c. $2,010 d. $5,760.

Answer 1

The amount Jerry paid in interest is $1,040.

The given details are:

Jerry's principal amount = $ 22,000,

quarterly payment for each quarter = $ 640

Total time for which Jerry paid each quarter = 9 years

As we know, one-year consists of nine quarters and therefore the nine years will consist of 36 quarters.

$\begin{aligned}\text{Total amount paid by Jerry}=\text{Quarterly payment} \times \text{No. of quarters}\end{aligned}$

$\begin{aligned}\text{Total amount paid by Jerry}={\ 640} \times {36}\end{aligned}$

$\begin{aligned}\text{Total amount paid by Jerry}=\ 23,040\end{aligned}$

Thus, the total amount paid by Jerry for nine years in each quarter is $23,040.

$\begin{aligned}\text{Amount of Interest}& = \text{Amount jerry paid} - \text{Principal Amount}\\\text{Amount of Interest}& = \ 23,040-\ 22,000\\\text{Amount of Interest} &= \ 1040\end{aligned}$

 

Therefore, the correct option is b.

To know more about the calculation of the interest, refer to the link below:

brainly.com/question/16242041