Question

To buy a laptop computer, Elaine borrowed $2,000 for 3 years at an annual simple interest rate of 5%. How much interest will she pay if she pays the entire loan off at the end of the third year? What is the total amount that she will repay? Im doing simple interest in class

Answer 1

To solve this problem we will use the following formula for simple interest:

`A=P(1+rt),`

where P is the initial amount, r is the simple interest rate, and t is the time in years.

Substituting P=2000, r=0.05, and t=3 we get:

`A=2000(1+0.05*3)=2300.`

Therefore, after 3 years the total amount to repay is %2300, and she will pay $300 of interest.

Answer: $300 of interest, $2300 total.