Question

Juanita has a loan of $25,260. This loan has a simple interest rate of 5% per year. What is the amount of interests that Juanita will be charged on this loan at the end of one year?

Answer 1

Answer:

$1,263

Explanation:

• Loan = $25,260.

,

• Simple interest rate = 5% per year.

To calculate the interest on the loan at the end of one year, we use the formula:

$Simple\: Interest=\frac{Principal\times Rate\times Time}{100}$

Substitute the given values:

$\begin{gathered} Simple\: Interest=\frac{25,260\times5\times1}{100} \\ =\ 1,263 \end{gathered}$

Juanita will be charged $1,263 on this loan at the end of one year.