Question

You borrow $1,000 on a simple interest loan. You pay an annual rate of 3.5%. You will take 3 years to pay back the loan. How much interest will you pay?

Answer 1

$105

Explanation:

Answer 2

Interest would be $105.

Explanation:

Your borrow $1000 on a simple interest loan. To find out interest we use this formula :

I = P R T

I = given Interest amount

P = $1,000 (Principal amount)

r = 3.5% or
`(3.5)/(100)` = 0.035 (rate of interest)

t = 3 (time in years)

Now we put the values

I = 1000 × 0.035 × 3

I = 1000 × 0.105

I = $105

You would pay interest $105.