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 leap year.)

Answer 1

He pays in interest of $111.0375. Interest is calculated in the two ways, by compounding or by simple interest.

How to calculate simple interest amount?

If the initial amount (also called as principal amount) is P, and the interest rate is R % annually, and it is left for T years for that simple interest, then the interest amount earned is given by:

$I = \dfrac{P \times R \times T}{100}$

The given data in the problem is;

The principal is,P=$2700

The rate of interest = 3.5%

The total time interval is,T

The total time interval is;

$\rm T= 5+365+31+21\ days$

The simple interest is found as;

$\rm SI = P \times R \times T \\\\ \rm SI = 2700 \times 0.0035 \times 1.172222 \\\\ SI=111.0375$

Hence, he pays in interest of $111.0375.

To learn more about simple interest, refer to the link;

brainly.com/question/5319581

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