Question

Nolan Walker decided to buy a used snowmobile since his credit union was offering such low interest rates. He borrowed $2,700 at 3.5% on December 26, 2019, and paid it off February 21, 2021. How much did he pay in interest? (Assume ordinary interest and no leapyear.) (Use Days in a year table.) (Do not round intermediate calculations. Round your answer to the nearest cent.)
Interest Paid?

Answer 1

Using the formula for simple interest, it is found that he paid $119.87 in interest.

The simple interest formula is given by:

$E = PIt$

• E is the amount of interest earned.
• P is the principal(the amount of money invested).
• I is the interest rate(yearly, as a decimal).
• t is the time, in years.

In this problem:

• Borrowed $2,700, thus $P = 2700$
• Interest rate of 3.5%, thus $I = 0.035$
• From December 26, 2019 to February 21, 2021, there were 423 days, thus the time in years is $t = \frac{423}{365} = 1.2685$

Thus, the interest paid was of:

$E = PIt = 2700(0.035)(1.2685) = 119.87$

$119.87.

A similar problem is given at brainly.com/question/9593067