Question

Eli has a loan of $3500 This loan charges 5% interest compounded annually. what is the amount of interest that Eli will be charged on this loan at the end of four years round to the nearest cent

Answer 1

Answer: 700
Explanation:
3,500 x 5 over 100 = 175
175 x 4 = 700

Answer 2

Answer:

754.27

Step-by-step explanation:

Use coumpound interest formula A=p(1+r)^t

Convert 5% into a decimal (move decimal over to times to the left making it .05)

Plug in numbers A=3500(1+.05)^4

Then you get $4254.27

Subtract by priciple of 3500 and you get left with 754.27