Jessica borrowed $8500 from the credit union to purchase a used car the credit union gave her a rate of 7.5% annually for a period of 2 1/2 years what is the total amount she will have to pay back at the end of the loan
To calculate the total amount Jessica will have to pay back at the end of the loan, we need to calculate the interest on the loan and add it to the principal (the amount borrowed).
The formula to calculate the interest on a loan is: Interest = Principal * Rate * Time
Step 1: Convert 2 1/2 years into a decimal form.
2 1/2 years is equivalent to 2.5 years.
Step 2: Calculate the interest.
Interest = $8500 * 7.5% * 2.5 years
= $8500 * 0.075 * 2.5
= $1593.75
Step 3: Calculate the total amount she will have to pay back.
Total amount = Principal + Interest
= $8500 + $1593.75
= $10093.75
Therefore, the total amount Jessica will have to pay back at the end of the loan is $10,093.75.