Two customers took out loans from a bank.
Jarrod took out a 5-year loan for $4,000 and paid 3.2% annual simple interest.
Harold took out a 7-year loan for $4,000 and paid 3.9% annual simple interest.
What is the difference between the amount of interest Jarrod and Harold paid for their loans???
Responses
A $1092$1092
B $640$640
C $452$452
D $1732 $1732
To calculate the difference in the amount of interest paid by Jarrod and Harold, we first need to calculate the interest paid by each of them.
For Jarrod:
Interest = Principal * Rate * Time
= $4,000 * 0.032 * 5
= $640
For Harold:
Interest = Principal * Rate * Time
= $4,000 * 0.039 * 7
= $1,092
The difference in the amount of interest paid is:
$1,092 - $640 = $452
Therefore, the correct answer is C) $452