Question

Hector took out a small loan of $900 for 18 months. The simple interest rate on the loan was 10.5%. How much will he pay in interest on the loan?

Answer 1

The answer would be $1.89 in interest.

Explanation:

First, change 10.5% into a decimal. To do this, you divide 10.5÷100. This equals 0.105

next, you multiply 0.105 with 12 (12 months in a year)

This equals 1.26

But, Hector still has 6 months left he has to pay for.

So, one way you can do this is divide 1.26 by 2, which equals 0.63.

THEN, you add 0.63 with 1.26, giving you the answer, 1.89

So, the answer for this equation would be 1.89.