Bob takes a loan of $7,000 on 5% interest rate for 5 months. How do you calculate the simple interest?

1 Answer
Dec 15, 2016

Answer:

Simple Interest = $145.83

Explanation:

Here, loan (P)= $7,000, Rate of Interest (R) = 5% and

no. of years (T) = 5 months = 5/12 year.

We know, Simple Interest #(I) = [PRT]/100#

So, #I = [7,000*5*5/12]/100 = [875]/6 = 145.83#