Karina bought a car three years ago for $20,000 and financed the full purchase price with a four-year (48 months) simple interest car loan at 5% (monthly payment = $460.59). If she has made all of her payments on time and has 12 payments remaining, her current loan balance (rounded to the nearest dollar) is

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The correct answer is A.The total interest paid over the life of the loan is $20,000 * 0.05 * 4 = $4,000. The total amount paid over the life of the loan is $20,000 + $4,000 = $24,000. The amount paid so far is $460.59 * 36 = $16,581.14. The current loan balance is $24,000 - $16,581.14 = $5,380.

Karina Bought a Car Three Years Ago for $20,000 and Financed