Mary is purchasing a new car and is researching loan rates at several banks. How much interest will Niles pay on his car loan if he finances $14,000 at an interest rate of 12.7% for 6 years?

Mary is purchasing a new car and is researching loan rates at several banks. How much interest will Niles pay on his car loan if he finances $14,000 at an interest rate of 12.7% for 6 years?

[A] $1167

[B] $11,128

[C] $1371

[D] $10,668

Solution:

This is a simple interest problem so 

where P=$14,000, r=0.127dollars per year, t=6yrs
and so

P=$10,668

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