Question

Annika's older cousin bored $800 to repair her car. she will pay off the loan after 2 years buy paying back the principal plus 4.5% simple interest each year. HOw much will she spend in interest?

Answer 1

Answer: She will spend $72.00 in interest.

Explanation:

First, we have to evaluate the numbers we have.

Principal: $800

Interest Rate: 4.5%

Time in years: 2 years

Interest earned/spent: ?

So, we have to find the interest spent.

Now, we have to calculate the formula.

800 x .045 x 2 = $72

Rounded to the nearest whole number/in dollars(money): $72.00

So, Annika's older cousin will spend $72.00 dollars in interest. :]

Answer 2

The equation below is provided:

$800 = principal amount borrowed/loaned
4.5% = interest per year
2 years = terms of payment

You need to know how much is the interest per year.
$800 * 4.5% = $36

Then, multiply the amount to the terms of payment to know the total amount of the interest to be paid.
$36 * 2 years = $72

The correct answer for the amount that Anika will spend for the interest is $72.