Question

Michael borrowed $1000 on a 2 year loan. He is charged 5% simple interest per year.

How much interest is he charged for 2 year? What is the total amount he has to pay
back?
O $1000, $3000
O $10, $1010
O $50, $5000
O $100, $1100

Answer 1

the last choice

Explanation:

simple interest means there is only interest on the original principal (1000$)

so 2 years of 5% would be 10%, 10% of 1000 is 100.

total amount = interest+principal, so it is 100, 1100