Ryan has an eight-year loan for $6,000. He is being charged an interest rate of 5 percent, compounded annually. Calculate the total amount that he will pay.

Question

anonymous · Answer

total amount=P(1+i)^{t}

anonymous · Answer

thats the equation^

anonymous · Answer

perfect
so take the 6000(1+.05)^{8}

anonymous · Answer

make sure to do the 1.05^8 first then multiply to the 6000

anonymous · Answer

P is principal - 6000.        i    is the interest at 5% .   and t is set at  8 years

anonymous · Answer

if this was a problem that was compounded at a different rate then annually it would have something P(1+i)^{t(x)} to show the different range

anonymous · Answer

thank you and i didnt have to do the 1.05^8 first ha i did it it gave me the wrong answer but i did it the other way got the right answer :)  but THANK YOU!!!

anonymous · Answer

good job, i always had that problem so i make sure that i do it this way first.