Question

Find the total amount due on a simple interest loan if the principal is $17,800 with a rate of 8% for 16 years.

Answer 1

The total amount due on a simple interest loan of $17,800 at an 8% rate for 16 years is calculated using the formula: Total amount = Principal + (Principal × Rate × Time). The interest is $22,656, making the total amount due $40,456.

Step-by-step explanation:

To calculate the total amount due on a simple interest loan, we use the formula: Total amount = Principal + (Principal × Rate × Time).

Given:

• Principal (P) = $17,800
• Rate (r) = 8% or 0.08 (as a decimal)
• Time (t) = 16 years

First, we calculate the simple interest:

Interest (I) = P × r × t
= $17,800 × 0.08 × 16
= $22,656

Now, we find the total amount due:

Total amount = P + I
= $17,800 + $22,656
= $40,456

The total amount due after 16 years on a $17,800 loan at an 8% simple interest rate is $40,456.