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???
To find the amount of interest paid by Jarrod, we use the formula: Interest = Principal * Rate * Time.
Interest = $4,000 * 0.032 * 5 = $640.
To find the amount of interest paid by Harold, we use the same formula: Interest = Principal * Rate * Time.
Interest = $4,000 * 0.039 * 7 = $1,092.
The difference between the amount of interest Jarrod and Harold paid for their loans is $1,092 - $640 = $452.