Marcy is planning to borrow $12,500 with a simple interest rate of 5.2% for 4 years. How much will she pay back to the bank?
12500 * 0.052 * 4 = ?
Add the amount of interest to the original loan to find the total.
2600.052
To find out how much Marcy will pay back to the bank, we can use the formula for calculating simple interest:
Simple Interest = Principal (P) x Interest Rate (R) x Time (T)
First, we need to convert the interest rate from a percentage to a decimal. The interest rate is 5.2%, so we divide it by 100:
5.2% / 100 = 0.052
Next, we can substitute the values into the formula:
Simple Interest = $12,500 x 0.052 x 4
Calculating this, we get:
Simple Interest = $2,080
This means that Marcy will pay an additional $2,080 to the bank. To find the total amount she will pay back, we need to add the original loan amount to the simple interest:
Total Payback = Principal + Simple Interest
Total Payback = $12,500 + $2,080
Calculating this, we get:
Total Payback = $14,580
Therefore, Marcy will pay back a total amount of $14,580 to the bank over the course of 4 years.