The owner of a service station receives a loan of $8,500 at 10.5% for 7 months. Find the amount of simple interest
$520.63
I = PRT
I = 8,500 * 0.105 * 0.58333
To find the amount of simple interest, we can use the formula:
Simple Interest = Principal * Rate * Time
In this case:
Principal = $8,500
Rate = 10.5% = 0.105 (converted to decimal form)
Time = 7 months
Plugging in the values into the formula, we get:
Simple Interest = $8,500 * 0.105 * 7
Calculating the result:
Simple Interest = $8,500 * 0.105 * 7
Simple Interest = $6,997.50
Therefore, the amount of simple interest is $6,997.50.
To find the amount of simple interest, we can use the formula:
Simple Interest = Principal x Rate x Time
Where:
Principal = The amount of the loan ($8,500)
Rate = The annual interest rate expressed as a decimal (10.5% = 0.105)
Time = The duration of the loan in years (7 months = 7/12 years)
Let's plug in the values and calculate the simple interest:
Principal = $8,500
Rate = 0.105
Time = 7/12 years
Simple Interest = $8,500 x 0.105 x (7/12)
= $8,500 x 0.105 x 7/12
= $8,500 x 0.735/12
= $521.25
Therefore, the amount of simple interest in this loan is $521.25.