To help restart the economy growth, government is offering simple interest loans to small business at a rate 1.5%.
Say,you obtain one of these loans of 90,000 for 5 years. Determine the amount of money you must repay the government after 5 years
The formula for calculating simple interest is:
I = P * r * t
Where:
- I = interest
- P = principal (the amount of the loan)
- r = interest rate per year
- t = time in years
Substituting the given values:
I = 90,000 * 0.015 * 5
I = 6,750
Therefore, the interest you will pay over 5 years is 6,750.
To determine the total amount to be repaid, you need to add the principal and the interest:
Total amount = principal + interest
Total amount = 90,000 + 6,750
Total amount = 96,750
So after 5 years, you will have to repay the government a total of 96,750 dollars.
To determine the amount of money you must repay the government after 5 years, we need to calculate the total amount to be repaid, which includes the principal amount and the interest.
The simple interest formula is:
Interest = Principal * Rate * Time
Given:
Principal = $90,000
Rate = 1.5% (or 0.015) per year
Time = 5 years
First, let's calculate the interest:
Interest = 90,000 * 0.015 * 5
= $6,750
The interest over 5 years is $6,750.
To find the total repayment amount, we need to add the interest to the principal:
Total Repayment = Principal + Interest
= 90,000 + 6,750
= $96,750
Therefore, you must repay the government a total of $96,750 after 5 years.