Question

Maya has a car loan of $31,470. The loan has a simple interest rate of 5% per year.

What is the amount of interest that Maya will be charged on this loan at the end of one year?

Answer 1

$1573.50

Explanation:

First, converting R percent to r a decimal

r = R/100 = 5%/100 = 0.05 per year,

then, solving our equation

I = 31470 × 0.05 × 1 = 1573.5

I = $ 1,573.50

The simple interest accumulated

on a principal of $ 31,470.00

at a rate of 5% per year

for 1 year is $ 1,573.50.