MATHEMATICS QUESTION

Question

Ron borrowed $ 20,000 to start up his consulting business. The loan had a simple interest rate of 5.6% for 2 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 0.056 ) t= time in years .

He will pay , what amount on the loan ?

Answer 1

he pays $2,240 in simple interest

plus pays back the principal

so he pays total $22,240

I=prt =20,000(.056)(2) = 2240

2240+20000 = 22,240