00:01
For this problem, we're looking at the amount of interest total that was paid if $715 was paid per month for seven years at a 9 .12 % interest.
00:13
So when we're taking all this into consideration, the first thing we need to figure out is, okay, what formula are we going to use? we're going to use this compound interest formula where a is the total amount, p is the principal, r is our interest rate, n is a number of times per year that the interest is compensated.
00:30
Compounded and t is the number of years so in the situation we don't even know the total amount that has been paid so to do that we're going to take that 750 715 multiply it by 12 because there's 12 months in a year and multiply it by 7 and that'll tell us the total amount that was paid so it's going to be 60 ,000 60 that's so much was paid until so that's going to be equal to to our a.
01:04
So let's go ahead and plug everything in now.
01:07
So we have 60 ,060 equals p, because we don't know our principle.
01:13
We don't know our principle.
01:14
So in order to us figure out our interest, we're going to be essentially taking the difference of the amount paid in our principal to get our total interest, but we don't know our principle yet.
01:23
So we're going to have to solve for that.
01:25
Okay, so our 2 because it's going to be in decimal form.
01:37
N is going to be 12 because again 12 months and a year and that's going to be raised to 12 times 7...