Question

The Galindo family plans to start a small business in our neighborhood. The father

borrows $10,000 from the bank at an annual interest rate of 7.5% rate for 42
months. What is the amount of interest he will pay on this loan?
$26.25
$26,250
$262,500
$2,625

Answer 1

$2,625

Step-by-step explanation:

Interest is calculated using the formula

I = p x r x t

For Galindo family

I= interest,

P = principal amount : $10,000

r= Interest rate: 7.5 % or 0.075

t= times in years : 3.5 years( 42 months /12)

I= $10,000 x 0.075 x 3.5

I=750 x 3.5

I=$2,625