Question

Jess borrows 250 from the bank. The band chargEs 11% simple interest over 2 years.

How much will Jess owe the bank at the end of 2 years?

Answer 1

$305

Explanation:

You have to use the following formula to calculate the accrued amount:

A=P(1 + rt), where:

A= accrued amount

P= principal amount= $250

r= rate of interest= 11%

t= time period= 2 years

Now, you have to replace the values in the formula:

A=250*(1+0.11*2)

A=250*(1+0.22)

A=250*1.22

A=305

According to this, at the end of 2 years, Jess owes the bank $305.