Question

You take out a 7 month, $6,000 loan at 8% annual simple interest. How much would you owe at the end of 7 months?

Answer 1

$6,280

Explanation:

Use the formula Interest = Principal * rate * time

I = P*r*t

I = ($6000)*(0.08) *( 7/12 years)

I = $ 6000 * .08 * 0.583333

I = $ 280

You would owe back $6000 plus the interest of $280

Total owed: $6280