Question

What is the simple interest of a loan for $1,000 with 5 percent interest after 3 years?

A.)$1,050
B.) $50
C.)$150
D.)$1,150

Answer 1

Answer: 150

Explanation: simple interest produces interest only over the initial amount, so every year the interest will be

1000 * 5/100= 50

So after three years (50x3) it would be 150