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Jim needs $55,000 to start his business. How much interest will he be charged at an 8.2% interest rate?

A) $4,510
B) $4,510.00
C) $44,510
D) $44,510.00

1 Answer

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Final answer:

Using the formula for simple interest, the interest Jim will be charged on a $55,000 loan at an 8.2% interest rate for one year is $4,510.

Step-by-step explanation:

Jim needs to calculate the amount of interest he will be charged at an 8.2% interest rate on a principal amount of $55,000 to start his business. The formula to calculate simple interest is Interest = Principal × rate × time. As the time period is not specified, we will assume it is for one year, which is common for initial loans. Applying the formula:

Interest = $55,000 × 0.082 × 1 = $4,510.

The correct answer is A) $4,510 or B) $4,510.00 since they are the same amount just represented with different formatting.

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