Hank purchased a $20,000 car two years ago using an 8 percent, 5-year loan. He has decided that he would sell the car now, if he could get a price that would pay off the balance of his loan. What is the minimum price Hank would need to receive for his car?

Question

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The minimum price Hank would need to receive is the remaining balance on his loan. After two years of payments on a 5-year loan at 8%, the remaining balance is approximately $12,941.12.

Hank Purchased a $20,000 Car Two Years Ago Using an 8