Question

1. Anvi borrowed $5,000 from a bank at a flat interest rate of 11% per year for a 3-year

period. How much interest does she have to pay the bank at the end of 3 years? (2dp)

Answer 1

He will have to pay $1,650 in interest at the end of 3 years.

Explanation:

This is a simple interest problem.

The simple interest formula is given by:

`E = P*I*t`

In which E is the amount of interest earned, P is the principal(the initial amount of money), I is the interest rate(yearly, as a decimal) and t is the time.

After t years, the total amount of money is:

`T = E + P`

Anvi borrowed $5,000 from a bank at a flat interest rate of 11% per year for a 3-year period.

This means that
`P = 5000, I = 0.11, t = 3`

How much interest does she have to pay the bank at the end of 3 years?

`E = P*I*t = 5000*0.11*3 = 1650`

He will have to pay $1,650 in interest at the end of 3 years.