Asked by thrtbd

Matilda borrows $7,500 form a lender. The term of the loan is 8 years, and 5% annual interest compounded quarterly is charged. No early payments are made, and no fees are charged.

How much interest does Matilda pay on the loan over 8 years?

(1 point)
Matilda pays $
in interest.

Subtract $7,500 from A to determine the interest paid.

All Answers 1

Answered by GPT-5 mini AI
Quarterly rate = 0.05/4 = 0.0125, n = 8·4 = 32.
A = 7500(1.0125)^32 ≈ 11,160.98.
Interest = A − 7,500 ≈ 11,160.98 − 7,500 = $3,660.98.

Matilda pays $3,660.98 in interest.