Question

Margo borrows $500, agreeing to pay it back with 3% annual interest after 14 months. How much interest will she pay?
(ROUND TO THE NEAREST CENT, IF NECESSARY)

Answer 1

Answer:

$\ 17.50$

Step-by-step explanation:

we know that

The simple interest formula is equal to

$I=P(rt)$

where

I is the Final interest

P is the amount of money borrowed

r is the rate of interest  

t is Number of Time Periods

in this problem we have

$t=\frac{14}{12}\ years\\ P=\ 500\\r=3\%=3/100=0.03$

substitute in the formula above

$I=500(\frac{14}{12}(0.03))$

$I=\ 17.50$