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Find the simple interest owed for the following loan. The interest is $ (Do not round until the final answer. Then round to the nearest cer Principal Rate Time in Years 1 $2975 6.5% 3/12

Find The Simple Interest Owed For The Following Loan The Interest Is Do Not Round Until The Final Answer Then Round To The Nearest Cer Principal Rate Time In Ye class=

Sagot :

The simple interest formula is given by

[tex]I=p\cdot r\cdot t[/tex]

where I is the interest, p is the principal, r is the interest rate and t the time in years.

In our case,

[tex]\begin{gathered} P=2975 \\ r=0.065 \\ t=3\frac{1}{2} \end{gathered}[/tex]

However, in order to use the above formula, we must convert the time into a simple fraction form, that is

[tex]3\frac{1}{2}=\frac{2\cdot3+1}{2}=\frac{7}{2}[/tex]

Then, by subsituting our values into the simple interest formula, we get

[tex]I=(2975)(0.065)(\frac{7}{2})[/tex]

which gives

[tex]\begin{gathered} I=\frac{13563.625}{2} \\ I=676.8125 \end{gathered}[/tex]

Then,by rounding to the nearest cent, the interest is $676.81

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