Terry and Jim have two car loans totaling $ 26,004.
One loan has an annual percentage rate (APR) of 3.1 % and the other has an APR of 7%.
If the total interest they paid after one year is $1,481.25, what is the amount owed on each car?
(1 = PRT. Note t = 1 year).
Answer needed right away!! With explanation

Answers

Answer 1

The annual percentage rate is the interest rate for payment for the car

loan.

The mount owed on the car with an APR of 3.1% is approximately $8,693.08.

The mount owed on the car with an APR of 7% is approximately $17,310.92.

The given parameters are;

The amount of loan Terry and Jim have = $26,004

The annual percentage rate (APR) on one loan = 3.1 %

The annual percentage rate (APR) on the other loan = 7 %

Total interest paid after one year = $1,481.25

Required:

The amount owed on each car

Solution:

Let X represent the loan, with 3.1% APR, we have;

The other loan with 7% APR = 26,004 - X

Therefore;

0.031·X + 0.07·(26,004 - X) = 1,481.25

0.031·X + 1,820.28 - 0.07·X = 1,481.25

1,820.28 - 1,481.25 = 0.07·X - 0.031·X = 0.039·X

339.03 = 0.039·X

[tex]X = \dfrac{339.03}{0.039} \approx 8693.08[/tex]

Therefore;

The amount owed on the car with an APR of 3.1%, X ≈ $8,693.08

Therefore;

The amount owed on the car with an APR of 7% ≈ 26,004 - 8693.08 =

17310.92.

The amount owed on the car with an APR of 7% ≈ $17,310.92

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