In order to start a small business, a student takes out a simple interest loan for $3000.003,000.00
for 66
months at a rate of 7.507.50%.
In order to start a small business, a student takes out a simple interest loan for $3000.003,000.00
for 66
months at a rate of 7.507.50%.
How much interest must the student pay?
For simple interest:
A = P (1+ r*t)
I = P*r*t
To find the amount of interest the student must pay, we can use the formula for simple interest:
I = P * r * t
Where:
I = Interest
P = Principal amount (loan amount)
r = Interest rate per period
t = Number of periods (months)
Plugging in the given values:
P = $3000.00
r = 7.50% or 0.075 (converted to decimal)
t = 66 months
I = $3000.00 * 0.075 * 66 = $1,347.00
Therefore, the student must pay $1,347.00 in interest for the loan.
To calculate the amount of interest the student must pay on a simple interest loan, we can use the formula:
I = P * r * t
where:
I = interest
P = principal amount (loan amount)
r = interest rate
t = time in years
In this case, the principal amount (loan amount) is $3,000.00, the interest rate is 7.50%, and the time is 66 months, which is equivalent to 5.5 years (66 divided by 12 months per year).
Let's calculate the interest:
I = $3,000.00 * 0.075 * 5.5
I = $1,237.50
Therefore, the student must pay $1,237.50 in interest.