# Algebra

posted by Sara

Wanda took out a personal loan for \$16,000 at 9% simple interest.
How much interest will she pay after 5 years?
Suppose she pays off the loan in 3 years instead of 5 years. How much money will she save in interest?

1. Anonymous

1. Wanda took out a personal loan for \$16,000 at 9% simple interest.
a. How much interest will she pay after 5 years?

2. Thomas

I - Interest
P - Principal
r - Rate
t - time (in years)

a ) I = Prt = \$16,000 * 0.09 * 5 = \$7,200. She will pay \$7,2000 in five years

b) Assuming the lender agrees to a 3 year time, when a five year was originally scheduled. Some lenders would not agree to this because they make more money with a 5 year loan as oppose to a 3 year loan.

The interest on a 3 year loan is

I = Prt = \$16,000 * 0.09 * 3 = \$4,320

So the Savings for a 3 year loan as oppose to 5 is \$7,200 - \$4,320 = \$2.880

## Similar Questions

1. ### math

what formula would i use to solve for this: Loan Interest A developer needs \$80,000 to buy land. He is able to borrow the money at 10% per year compunded quarterly. How much will the interest amount to if he pays off the loan in 5yrs?
2. ### Finance

Five years ago, you bought a house for \$151,000. You had a down payment of \$30,000, which meant you took out a loan for \$121,000. Your interest rate was \$5.75% fixed. You would like to pay more on your loan. You check your bank statement …
3. ### Algebra: Statistics

Five years ago, you bought a house for \$151,000, with a down payment of \$30, 000, which meant you took out a loan for \$121,000. Your interest rate was 5.75% fixed. You would like to pay more on your loan. You check your bank statement …
4. ### math

Five years ago, you bought a house for \$151,000, with a downpayment of \$30,000 which meant you took out a \$121,000 loan. Your interest rate was 5.75% fixed. You would like to pay more on your loan. You check your bank statement and …
5. ### MATH

Five years ago, you bought a house for \$151,000, with a down payment of \$30,000, which meant you took out a loan for \$121,000. Your interest rate was 5.75% fixed. You would like to pay more on your loan. You check your bank statement …

If Wilma borrows \$5,000 from her brother (at 5% interest per year) and the loan matures in 10 years, how much will she have to pay annually to pay the loan off in 10 years?
7. ### Plz Hellp

Wanda took out a personal loan for \$16,000 at 9% simple interest. How much interest will she pay after 5 years?
8. ### Math Check My Work Please 2

15. Lisa takes a loan of \$10,500 at a 9% simple interest rate for 7 years. a. How much interest will she pay after 3 years?
9. ### Math

Lisa takes a loan of \$10,500 at a 9% simple interest rate for 7 years. a. How much interest will she pay after 3 years?
10. ### finance

You would like to buy a Mazda Miata Convertible for a purchase price of \$27,500. You will take out a loan for the entire amount. a. You have excellent credit so you can secure a loan at 5% APR for 3 years. What is your monthly payment?

More Similar Questions