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You took out a $5000 car loan from a bank that is going to charge you month 4% APR for the next 3 years list how much interest you pay for this loan, list how much the loan will cost you overall and your monthly payment for the loan.

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michell96

The final values ​​of the loan would be:

  • The cost of the payment for each month is: $ 138.88 + $ 16.66 = $ 155.54 (interest)
  • The total cost of interest is: $ 600 = $ 200 × 3 years.
  • The total cost of the loan is $ 5000 + $ 600 = $ 5600 (3-year interest)

What is the APR?

APR is an acronym for the percentage interest rate on a loan that a bank charge for each year that the loan is repaid. According to the above, in a loan of $ 5000, we must pay 3 times the 4% because the payment will be made within 3 years.

To know the value of the interest on the loan we must divide the value of the loan by 100 and multiply the result by 4 as shown below:

  • $ 5000 ÷ 100 = $ 50
  • $ 50 × 4 = $ 200

According to the above, the value of the interest is $ 200. To know the total value of the interest we must multiply $ 200 by the years that we are going to pay the loan as shown below:

  • $ 200 × 3 = $ 600

Finally, to know how much we must pay each month we must divide the total value of the loan by the number of months that we are going to pay the loan. On the other hand, we must divide the total value of the interest by the number of months that we are going to pay the loan and add it to the total value of each month as shown below:

  • $ 5000 ÷ 36 = $ 138.88
  • $ 600 ÷ 36 = $ 16.66
  • 138.88 + $ 16.66 = $ 155.54

Learn more about APR in: https://brainly.com/question/8846837

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