If you borrowed #6558.25 at a Simple interest rate of 4.25% for 7 months, what interest did you pay to the lending institution
To calculate the interest paid on a loan with simple interest, you can use the formula:
Interest = Principal x Rate x Time
Where:
- Principal = $6558.25
- Rate = 4.25% or 0.0425 (decimal form)
- Time = 7 months
First, convert the annual interest rate to a monthly rate:
Monthly Rate = 4.25% / 12 months = 0.0425 / 12 = 0.00354
Next, calculate the interest paid:
Interest = $6558.25 x 0.00354 x 7 = $164.93
Therefore, you paid $164.93 in interest to the lending institution.