Problema Solution
the easy loan company charges 28% simple interest (annual) for a 2 year, $600 loan.
find total interest
interest for 3 months
the total amount to be paid to the loan company at the end of two years
Answer provided by our tutors
let
r = 0.28 is the annual interest as a decimal
P = $600 is the principal
t = 2 yr
A = the future value
find total interest:
I = P*r*t
I = 600*0.28*2
I = $336
interest for 3 months:
t = 3/12 = 1/4 = 0.25 yr
I = P*r*t
I = 600*0.28*0.25
I = $42
the total amount to be paid to the loan company at the end of two years:
P + I = 600 + 336 = $996.