Final answer:
Using the simple interest formula I= PRT, if you borrow $5,000 at a 9% rate for 2 years, you will pay a total of $900 in interest.
Step-by-step explanation:
To calculate the interest you will pay on a loan, you can use the simple interest formula I = PRT, where I stands for interest, P is the principal amount (the initial loan), R is the annual interest rate in decimal form, and T is the time in years the money is borrowed for. In your case, you are borrowing $5,000 at a 9% rate for 2 years. To find the simple interest on this loan, first convert the interest rate from a percentage to a decimal by dividing it by 100, which gives us 0.09. Then multiply the principal amount by this decimal interest rate and by the number of years you will keep the loan.
The formula with your numbers plugged in looks like this: I = 5000 * 0.09 * 2. Doing the calculation yields I = 5000 * 0.18, which equals $900. Therefore, the total interest payment for your loan after 2 years would be $900.