Question

QueSLIUI

A friend asks to borrow $250 for 18 months and agrees to pay 12% annual simple interest. How much interest will you

earn?

Round your answer to the nearest dollar.

Provide your answer below:

Answer 1

$90 of interest will be earned.

Explanation:

We are given the following in the question:

Principal,P = $250

Time, T = 18 months = 3 years

Rate, R = 12% = 0.12

Formula for simple interest:

`I =(P* R* T)/(100)`

Putting values, we get,

`I =(250* 12* 3)/(100) = \$90`

Thus, interest of $90 will be earned.