Question

A woman uses a loan program for small business to obtain a loan to help expand her vending machine business. The woman borrows $27,000 for 2 years with a simple interest rate of 1.9%. Determine the amount of money the woman must repay after 2 years.

Answer 1

From the question;

The principal is $27,000, the rate is 1.9% and the time is 2 years.

The formula for interest accrued over this time period is;

`I=(PRT)/(100)`
`I=(27000*1.9*2)/(100)=1026`

Therefore, the amount owed is;

Principal + Interest = 27,000 + 1026 = $28,026