How do you find the simple interest paid after 5 months on a loan of $7,000 borrowed at an annual interest rate of 5%?

Question

1264 views around the world

You can reuse this answer
Creative Commons License

Answer 1 · 2016-12-16T11:12:21

#SI = $145.83#

The for simple interest is #SI = (PxxR xxT)/100#

The time is given in years, so in this case, the time of 5 months has to be converted to years by dividing by 12.

5 months = #5/12# years.

#SI = (7000xx 5 xx (5/12))/(100)#

This can also be written as:

#SI = (7000 xx 5 xx 5)/(" "100 xx 12)#

#SI = $145.83#