A student borrowed $19,000 at an annual interest rate of 6.4%. Calculate the amount of interest due 3 months after the student has begin making payments
Question is not clear.
How is the interest rate compounded?
When are payments made?
What is that payment?
To calculate the amount of interest due 3 months after the student has begun making payments, you will need to know the formula for calculating simple interest.
The formula for calculating simple interest is:
Interest = Principal * Rate * Time
Where:
- Principal is the amount of money borrowed
- Rate is the annual interest rate
- Time is the duration in years
In this case, the principal is $19,000 and the annual interest rate is 6.4%. However, the time given is in months (3 months), so we need to convert it to years by dividing it by 12.
Let's calculate the interest:
Interest = $19,000 * (6.4% / 100) * (3 / 12)
First, divide the annual interest rate (6.4%) by 100 to convert it to decimal form: 6.4% / 100 = 0.064
Next, divide the given time in months (3 months) by 12 to convert it to years: 3 months / 12 = 0.25 years
Now, substitute the principal, rate, and time into the formula:
Interest = $19,000 * 0.064 * 0.25
Calculate the value:
Interest = $304
Therefore, the amount of interest due 3 months after the student has begun making payments is $304.