Adam takes a loan of $8,250 at a 7% simple rate for 5 years.
How much interest will be paid after 3 years?
How much interest will be paid in total for the loan?
A.$577.50;$2,887.50
B.$1,732.50;$2,887.50
C.$4,352.00;$7,253.50
D.$17,325.00;$28,875.00 what is the correct answer
The correct answer is B.
To calculate the interest paid after 3 years, we can use the formula:
Interest = Principal x Rate x Time
Interest = $8,250 x 0.07 x 3
Interest = $1,732.50
To calculate the total interest paid for the loan, we can use the same formula but with the full 5-year term:
Interest = $8,250 x 0.07 x 5
Interest = $2,887.50