Final answer:
The Son's total interest income is $1,600. This is solely from the certificate of deposit as the loan from the Father was interest-free and does not contribute to the interest income.
Step-by-step explanation:
The total interest income earned by the Son is $1,600. This is the interest from a certificate of deposit for the year, and since the loan from the Father was interest-free, no additional interest income needs to be considered.
For learning purposes, let's look at how to calculate simple interest, which is helpful in understanding this situation. Simple interest can be calculated using the formula Interest = Principal × Rate × Time. However, in this scenario, since the Father's loan to the Son is interest-free, the formula is not applied to that portion of the funds. If the Father had charged an interest rate, we would need to consider that in the Son's total interest income.
To illustrate simple interest further with another example, if someone borrows $10,000 at a 5% simple interest rate for 5 years, the interest would be calculated as $10,000 × 0.05 × 5, resulting in $2,500 of interest.