Paul received a 12,000 loan from the bank. The bank charges his 6.99% yearly interest rate. 4 years, how much money does Paul owe in interest

Principal amount = 12,000

Annual interest rate (r) = 6.99% = 0.0699

Time (years) = 4 years

Number of installments (t) = 12*4 = 48 months

Monthly payment, A = P/D

Where,

D = { (1+r/12) ^t-1}/{r/12 * (1+r/12) ^t} = { (1+0.0699/12) ^48-1}/{0.0699/12 (1+0.0699/12) ^48} = 42.47

Therefore, A = 12000/42.47 = 282.59

Total payments after 4 years = 282.59*4*12 = 13,564.17

Interest owed = 13,564.17 - 12,000 = 1,564.17