Question

Harold wants to borrow $1,400 for 5 years. The interest rate is 9%. How much interest will he pay over the course of the loan?

Answer 1

Answer: He will pay $630 over the course of the loan.

Explanation:

Formula for simple interest :

S.I. = PRT, where P=principal amount , R =rate of interest ( in decimal), T=time (in years)

As per given ,

P = $1,400 , t = 5 years , r = 9% = 0.09

Simple interest = (1400) x (0.09) x (5)

⇒ Simple interest = $ 630

Hence, he will pay $630 over the course of the loan.