Question

The total interest on a 5 year 5.2% loan with a principal of $10,000 is 10,000 × 0.052 × 5 = $2,600.

True or False?

Answer 1

True

Explanation:

First, converting R percent to r a decimal

r = R/100 = 5.2%/100 = 0.052 per year,

then, solving our equation

I = 10000 × 0.052 × 5 = 2600

I = $ 2,600.00

The simple interest accumulated

on a principal of $ 10,000.00

at a rate of 5.2% per year

for 5 years is $ 2,600.00.