TJ had a car loan for $5800. Over the course of the loan, he paid a total of $1508 in interest at a rate of 6.5%. Over how many months did TJ pay off the car loan?
Looking at your other post, I will assume that we are again talking about "simple interest"
(in reality simple interest would not be used for any length of time greater than one year. As a matter of fact the method used above would result in a rate much higher than 6.5%)
I = PRT
1508 = 5800(.065)T
T = 1508/(5800x.065) = 4
since the units of T from the formula is the number of years, for T = 4 yrs
it would need 48 payments.
If you are interested, I could calculate the "real" interest rate for the car loan.
I think that got it for us. Thank you so much!!
To find the number of months it took TJ to pay off the car loan, we need to divide the total interest paid by the monthly interest payment.
Step 1: Determine the monthly interest payment.
Monthly interest payment = (Total interest paid) / (Loan term in months)
Given that TJ paid a total of $1508 in interest and the loan term is unknown, we need additional information to proceed.
To determine the number of months it took TJ to pay off the car loan, we need to calculate the monthly payment amount. We can then divide the total amount paid (including interest) by the monthly payment to find the number of months.
First, let's calculate the interest paid per month. The annual interest rate is 6.5%, which we need to convert to a monthly rate by dividing it by 12 (months in a year):
6.5% ÷ 12 = 0.065 (monthly interest rate)
Next, multiply the loan amount by the monthly interest rate to find the monthly interest payment:
$5800 x 0.065 = $377 (monthly interest payment)
Now, subtract the monthly interest payment from the total monthly payment to find the principal payment. Let's assume the total monthly payment is $P:
$P - $377 = Principal payment
Since the interest is a fixed amount, subtracting it from the total payment will give us the principal payment. Unfortunately, the total monthly payment ($P) is not given, so we can't determine the exact number of months without that information. Please provide the total monthly payment, and I'll be happy to help you further.