Question

You have loaned a friend $100 and will charge him 5% annua simple interest when he pays it back.

Answer 1

The annual interest would be $5 if you have loaned a friend $100 and will charge him 5% annually and the total amount would be $105.

What is simple interest?

It is defined as the interest based on the principal amount, it does not include the compounded amount. The interest calculates on the initial amount of borrowed amount.

We have:

You have loaned a friend $100 and will charge him 5% annually.

As we know:

A = P(1 + rt)

P = $100

r = 5% = 0.05

t = 1 years

A = 100(1 + 0.05×1)

A = $105

I = A - P = 105 - 100 = $5

Thus, the annual interest would be $5 if you have loaned a friend $100 and will charge him 5% annually and the total amount would be $105.

Learn more about the simple interest here:

brainly.com/question/22621039

#SPJ1