Question

Salma obtains a loan for home renovations from a bank that charges simple interest at an annual rate of 3.6%. Her ioan is for $ 14,300 for 78 days. Assume each day is 1/365 of a year.

Answer 1

To calculate the interest on Salma's loan, we use the simple interest formula with the given principal, rate, and time converted into years. Salma will have to pay around $110.16 as interest for her 78-day home renovation loan.

Step-by-step explanation:

The simple interest Salma will pay for a home renovation loan of $14,300 at an annual interest rate of 3.6% for 78 days is calculated using the simple interest formula I = PRT, where I is the interest, P is the principal amount, R is the rate of interest per year, and T is the time in years. Given each day is 1/365 of a year, we convert the 78 days into years by dividing by 365.

The time in years T = 78 / 365. The rate of interest R = 3.6% or 0.036 as a decimal. So:

T = 78 / 365
T = 0.2137 years approximately.

Now, we calculate the interest using the formula:

I = $14,300 * 0.036 * 0.2137
I = $110.16 approximately.

Salma will have to pay $110.16 in interest for the loan after 78 days.