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Elsa’s friend borrows $400 with an interest rate of 1.5%. How much interest will she pay after 4 years?

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Formula I = P x r x t

p is the principal amount, $400.00

r is the interest rate 1.5% a yea (0.015 in decimal)

t is time involved 4 years

so t is 4 year time periods

To find the simple interest we multiply 400 x 0.015 x 4 to get $24.00

so if you borrowed the $400 dollars you would now owe $424

Answer: so it's $24 interest or $424 since it's usually added to the principal

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