Question

A woman uses a loan program for small business to obtain a loan to help expand her vending machine business. The woman borrows $27,000 for 2 years with a simple interest rate of 1.9%. Determine the amount of money the woman must repay after 2 years.

Answer 1

From the question;

The principal is $27,000, the rate is 1.9% and the time is 2 years.

The formula for interest accrued over this time period is;

$I=\frac{PRT}{100}$$I=\frac{27000\times1.9\times2}{100}=1026$

Therefore, the amount owed is;

Principal + Interest = 27,000 + 1026 = $28,026