Question

A bank charges 12% simple interest p.a on cash loans to its clients. Titos has asked for a R10 000 loan amount and has promised to repay the loan over 4 years.. 1.4.Calculate the interest which Titos should pay for the loan? 1.1.5. Calculate the total amount tito must pay back after 4 years. 1.1.6. Give one reason why people loan money from banks?​

Answer 1

4800

Explanation:

interest=principle × rate × time/100

interest=10000 ×12 × 4/100

interest= 480000/100

interest=4800

amount=interest+principle

amount=4800+10000

amount=14800

people loan money from banks because they need money at a particular point in time where they do not have it

Answer 2

1.4. The interest Tito should pay would be R10000 * 12% = R1200 for his first year.

1.1.5. The total amount Tito must pay back after 4 years would be R10000 * (1 + 12%)^4 = R10000 * 1.57351936 = R15735.2 (cor. to 1 d. p.).

1.1.6. People loan money from banks due to financial troubles or to attain startup resources for a company or business venture.

Explanation:

Hope this helped!