Question

Ron borrowed $30,000 to start up his consulting business. The loan had a simple interest rate of 5.5% for 4 years. Use the formula I=prt to find the amount of interest he will pay on the loan. I= interest, P=principal, R=rate (expressed as a decimal 0.055), T=time in years.

Answer 1

we use formula of simple interest

$I=p\times r\times t$

the replace our values

$\begin{gathered} I=(30000)\times(0.055)\times(4) \\ I=6600 \end{gathered}$

The amount of interest he will pay $6,600