Answer:
The formula to calculate the amount of loan with flat rate interest is:
Amount = Principal + (Principal x Rate x Time)
Where,
Principal = the amount of loan
Rate = the interest rate per year
Time = the time period in years
Given,
Principal = K40,000.00
Rate = 9% per year
Time = 2.5 years
Substituting the values in the formula, we get:
Amount = K40,000.00 + (K40,000.00 x 0.09 x 2.5)
Amount = K40,000.00 + K9,000.00
Amount = K49,000.00
Therefore, the amount he will pay the bank is K49,000.00.