You have borrowed $130,000 to buy a new motor home. Your loan is to be repaid over 15 years at 8% compounded monthly. Calculate the total amount of interest you will pay over the life of the loan.

A) $47,451
B) $93,677
C) $126,226
D) $299,090

To calculate the total amount of interest paid over the life of the loan, first, find the monthly payment using the formula for a loan amortization: $M=P\frac{r(1+r{)}^n}{(1+r{)}^n-1}$ , where $M$ is the monthly payment, $P$ is the principal amount ($130,000), $r$ is the monthly interest rate (annual rate divided by 12, so 0.08/12), and $n$ is the total number of payments (15 years * 12 months = 180). Plugging in the values, we get $M=130,000\frac{\mathrm{0.006666...}(1+\mathrm{0.006666...}{)}^{180}}{(1+\mathrm{0.006666...}{)}^{180}-1}$ . Calculating this gives a monthly payment of approximately $1,240.48. Over 180 payments, the total amount paid is $1,240.48 * 180 = $223,286.40. The total interest paid is the total amount paid minus the principal, which is $223,286.40 - $130,000 = $93,286.40, which rounds or approximates closely to the given option B, $93,677 due to rounding differences in the calculation steps.