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Travis took out a six-year loan with a principal of $15,000. He made monthly payments of $225 for the entire period, at which point the loan was paid off. How much did Travis pay in interest?
a.
$1,200
b.
$1,350
c.
$800
d.
$0
The loan was for a six year period, this is 6 years * 12 months = 72 months.
He payed $225 per month for a total of $225 * 72 months = $16,200.
So in total he paid off $16,200 - $15,000 = $1,200 more than he loaned over a six year period. So the correct answer is: a. $1,200.
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