Question

Molly borrowed $8,300 for a car at a rate of 7%. What is the amount of interest that she would have to pay back after 1 year? Don't forget that rate MUST be in decimal.

Answer 1

$581

Explanation:

You are going to want to use the simple interest formula for this. The one below is modified for solving the interest earned.

`I = Prt`

P = principal amount

r = interest rate (decimal form)

t = time

The first step is to convert 7% into a decimal:

7% ->
`(7)/(100)` -> 0.07

Now, plug in the values:

`I=8,300(0.07)(1)`

`I=581`

Molly would have to pay back $581 in interest.