Question

Calculate the amount to be paid back on a $20,000 loan with an interest rate of 12% compounded yearly after five years.(1 point) Responses $640,000 $640,000 $1,030,726 $1,030,726 $51,470 $51,470 $35,246.83

Answer 1

[AI-generated answer — Bot GPT 3.5]

To calculate the amount to be paid back on a loan with compound interest, we can use the formula:

A = P (1 + r)^n

Where:
A = Amount to be paid back
P = Principal amount (loan amount) = $20,000
r = Annual interest rate = 12% = 0.12
n = Number of years = 5

By substituting the given values into the formula, we can calculate the amount to be paid back after 5 years:

A = $20,000 (1 + 0.12)^5 = $20,000 (1.12)^5 = $20,000 * 1.7623 = $35,246.83

Therefore, the correct response is $35,246.83.