calculate the interest on a five-year loan of $13,950 at a 5.8% rate of interest.
4045.50
I = PRT
I = 13,950 * 0.058 * 5
To calculate the interest on a loan, you need to multiply the principal amount (the loan amount) by the interest rate and the time period.
Step 1: Convert the interest rate to a decimal form
The interest rate is given as 5.8%. To use it in the calculation, divide it by 100 to convert it to decimal form.
5.8% = 5.8/100 = 0.058
Step 2: Multiply the principal amount, interest rate, and time period
Given:
Principal amount (loan amount) = $13,950
Interest rate = 0.058 (5.8% in decimal form)
Time period = 5 years
Interest = Principal amount * Interest rate * Time period
= $13,950 * 0.058 * 5
= $4,063.5
Therefore, the interest on a five-year loan of $13,950 at a 5.8% rate of interest is $4,063.5