Answer :
$11,062.40
Explanation :
The formula for the future amount in a compounding interest is :
[tex]A=P(1+\frac{r}{n})^{nt}[/tex]Where P is the present value
r is the rate of interest
n is the number of compounding in a year
t is time in years
From the given problem,
She puts a downpayment of $600 so the remaining will be :
9000 - 600 = 8400, which she will be financing for 4.5 years
So P = 8400
r = 5% or 0.05
n = 1 (Since it will only be compounding once in 1 year - annually)
t = 4.5 years
Using the formula above :
[tex]\begin{gathered} A=8400(1+\frac{0.05}{1})^{1(4.5)} \\ A=10462.40 \end{gathered}[/tex]The value of the $9000 car after 4.5 years will be the sum of the downpayment and the future amount.
[tex]600+10642.40=\$11,062.40[/tex]The answer is $11,062.40
