Sonja needs to borrow $2,251 to pay for her college classes. Sallie Mae is offering her a 4.5% simple interest loan with an interest charge of $405.18 over the life of the loan. How many years is Sallie Mae giving her to pay back the loan with interest?
To find the number of years that Sallie Mae is giving Sonja to pay back the loan with interest, we can use the formula for simple interest:
Interest = Principal × Rate × Time
In this case, the interest charge is $405.18, the principal (amount borrowed) is $2,251, and the interest rate is 4.5%.
Substituting these values into the formula, we have:
$405.18 = $2,251 × 0.045 × Time
Now, we can solve for Time (the number of years) by dividing both sides of the equation by ($2,251 × 0.045):
$405.18 / ($2,251 × 0.045) = Time
Using a calculator, we find:
Time ≈ 4.08 years
Therefore, Sallie Mae is giving Sonja approximately 4.08 years to pay back the loan with interest.