Question

How much simple interest will you pay on a 90 day loan of $625 at 15%?

Answer 1

`$281.25`

Explanation:

Take `$625` loan amount and multiply by `15%=$93.75` to determine how much monthly in interest you will pay; then multiply by `3` because `90` days = `3` months.

`$93.75 xx 3 = $281.25`

Answer 2

`=$23.44` Interest to be paid

Explanation:

Simple Interest is calculated using the formula:

`SI = (PRT)/100`

The time has to be in years,

We can treat `90` days as `3` months, which is `3/12` of a year.

`SI = (625 xx15xx3)/(100xx12)`

`=$23.44` Interest to be paid