Car payments: Charlie borowed $11,500 to purchase a new car. His loa. Requires him to pay $288.65 each month over the next 60 months(five years). How much will he pay over the five years? How much more will he pay back than the amount of the loan ?
How much will he pay over the five years
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If Charlie pays $288.65 every month then he will be paying $17,319 (= $288*6) in 60 months.
Which is $5,819 ($17,319-$11,500) more than the amount he borrowed $11,500.
This works out to be interest rate of 17.46%