Question 1197708
A bank loan of $8000 is repaid in annual payments of $1000plus 10% interest on the unpaid balance.What is the total amount of interest paid?

Thank you for asking
<pre>I'm very surprised to see someone who's supposed to be a "tutor" spell the past tense of pay as "p-a-y-e-d" instead of the
CORRECT spelling, P-A-I-D, ESPECIALLY when the "student" spells it correctly! Never seen anything like this! I definitely would
expect this from a person whose 1st language is NOT ENGLISH!

The agreement is that $1,000 is paid every year, so there will be 8 payments to pay off this loan. Each year, starting with year
1, the interest would be 10% of the balance. Hence, the 10% interest is 1st <font face = "consolas" color = "red" size = 4><b><u>PAID</font></b></u> on the $7,000 balance ($700) after the 1st $1,000 payment
is made. The 2nd payment would then be on a balance of $6,000, then $5,000, and so forth, for a total of 7 (8 - 1) interest payments.
The interest payments for this particular problem can be done MANUALLY because there're only 8 loan payments and 7 (8 - 1) interest
payments. However, should a problem consist of many more interest payments, it's a lot easier to use the 
formula for the sum of an AP: {{{matrix(1,3, S[n], "=", (n/2)(2a[1] + (n - 1)d))}}}
                              {{{matrix(1,3, S[7], "=", (7/2)(2(700) + (7 - 1)(- 100)))}}} ---- Substituting 7 for n, 700 for a<sub><b>1</sub></b>, and - 100 for d.
                              {{{matrix(2,3, S[7], "=", (7/2)("1,400" - 100(6)), S[7], "=", (7/2)("1,400" - 600))}}}
                 Sum of 7 years' interest payments of 10% on loan balance after a $1,000 loan payment is made each year, or           
                             {{{highlight_green(matrix(1,9, S[7], "=", (7/2)(800), "=", (7/cross(2))400cross((800)), "=", 7(400), "=", highlight("$2,800")))}}}</pre>