Question

Seki, a professional bike racer, takes out a loan to buy her first high-end bike. The bike costs $seven thousand, five hundred, and the simple interest loan is for thirty months. She calculates that she will end up paying $seven hundred fifty in interest over the life of the loan.

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What is the interest rate on Seki's loan?
The following sentence or sentences contain missing information in the form of one or more blanks. For each blank, there will exist a corresponding input field. Use the input fields to complete the sentence or sentences.

Interest Rate =
%

What is the total amount Seki will pay when the loan is due?


Balance = $

Answer 1

Seki will pay $8,250 when the loan is do
Hope this helps

Answer 2

Answer: Seki's interest rate for the bike is 33.33% each year; Seki will owe $8250 at the end of the loan.

Explanation:

To calculate the simple interest rate, the equation is: r = (1/t)(A/P - 1)

Where:

r - interest rate per year (in decimal format)

t -time (loan time in years)

A - total accrued amount (initial price paid + amount of interest paid)

P - principle (initial price paid)

For this scenario:

r = (1 / 30)(8250 / 7500 - 1)

- simplify both sets of parentheses: 1 / 30 and 8250 / 7500

r = (.033333)(1.1 - 1)

- simplify the second set of parentheses

r = (0.033333) x 0.1

- multiply

r = 0.0033333

- convert r (as a decimal) to R (as a percentage) by multiplying r x 100

R = .3333

The interest rate on Seki's loan is 33.33%

The total amount Seki will pay:

equation for total due: A = P + I

Where:

A - total accrued amount (initial price paid + amount of interest paid)

P - principle (initial price paid)

I - amount paid in interest that accrued over time

For this scenario:

A = 7500 + 750

A = 8250

Seki will pay $8250 when the loan is due.