This lesson combines what you learned about calculating the payment on a loan using the PMT function with calculating the total amount of the loan in order to calculate the interest on a loan. As you watch this video, follow along in Excel. You can use Excel for your practice problems and the quizzes, so it will be helpful for you to practice.

Video Source (07:26 mins) | Transcript

Total interest = Total amount of loan − Original principal amount

Practice Problems

- Use Excel to calculate the total interest on a $45,000 loan for a small business making monthly payments with an interest rate of 7.5% over 10 years.
- Use Excel to calculate the total interest on a $45,000 loan for a small business making monthly payments with an interest rate of 5.25% over 15 years.
- Use Excel to calculate the total interest on a car loan paid monthly given the following values:
- Amount of loan = 13,500
- Annual interest rate = 5.75%
- Length of the loan = 6 years

- Use Excel to calculate the total interest on a car loan paid monthly given the following values:
- Amount of loan = 13,500
- Annual interest rate = 4.25%
- Length of the loan = 6 years

- Use Excel to calculate the total interest on a mortgage paid monthly given the following values:
- Amount of loan = 245,500
- Annual interest rate = 3.875%
- Length of the loan = 30 years

- Use Excel to calculate the total interest on a cell phone for $800 at 5.25% interest over two years making monthly payments.