Amanda bought a car for $8,500. Her loan was for five years at a 4.6% interest rate. How much will Amanda pay for her car total, including interest?
I = PRT
I = 8,500 * 0.046 * 5
Add the interest to the principal.
8,500$ car, wow
So if the interest rate is 4.6% for 5 years, she has to pay that percentage of the total cost each year. There is an equation for this, but to make it simpler ill tell you it this way:
8500 Initial cost
8500*1.046 cost after 1 year
=8891
8891*1.046 Cost after 2 years
=9299.986
And so continue on until you get to 5 years.
To calculate how much Amanda will pay for her car, including interest, we need to find the total amount she will repay on the loan.
First, let's calculate the total interest paid over the loan term. The formula to calculate simple interest is as follows:
Interest = Principal * Rate * Time
In this case, the principal (P) is $8,500, the rate (R) is 4.6%, and the time (T) is five years. Let's substitute these values into the formula:
Interest = $8,500 * 0.046 * 5
= $1,955
So, Amanda will pay $1,955 as interest over the five-year loan term.
To find the total amount Amanda will pay for her car, including interest, we need to add the principal and the interest together:
Total amount = Principal + Interest
= $8,500 + $1,955
= $10,455
Therefore, Amanda will pay a total of $10,455 for her car, including interest.