You decide to buy a 60 inch plasma-screen TV. You borrow $4500 from the electronics store at 1.9% per month simple interest, with no payments due for 2 years from the date of purchase. How much will you owe on the loan after 15 months?

Question

2552 views around the world

You can reuse this answer
Creative Commons License

Answer 1 · 2017-10-05T07:48:29

$$4606.88$ (rounded to the nearest cent)

The equation for simple intrest is:

$I=(PRT) /100$

Where:
P = Principle (the amount that is going to have intrest on it)
R = Rate of interest
T = Time in years

Since you did not pay anything since the date of purchase, P = $$4500$ , R = $1.5$ and T = $1. 25$ (since $15$ months is $1. 25$ years)

Plugging all the numbers into the simple interest equation... You get:

$I=(4500xx1. 9xx1.25)/100$

$=$106.875$

Don't forget to add your principle back in, as this is only the "extra" money coming from the intrest

$$106.875+$4500=$4606.875$

Round your answer to the nearest cent

$~~$4606.88$