Question

Jamal borrowed $15 600 for 6 years from a bank. The annual simple interest rate for the first 3 years is 1.6%. From then onward, the annual simple interest rate is increased to 2%. How much interest will he owe at the end of 6 years?​

Answer 1

the interest owed is 1684.8

Explanation:

Formula for simple interest =

I = Prt, where P is amount borrowed, r for interest rate and t for time.

Since the first three years is 1.6% interest we can write:

I = 15600 x 0.016 x 3

= 748.8

Then for the following 3 years the interest rate is 2%:

I = 15600 x 0.02 x 3

= 936

Adding the values gives us 1684.8