Question

The interest paid on a $8,000 loan is $600, a rate of 4%

Answer 1

It took 1.9 years to pay back the loan.

What is Interest ?

Interest is the amount of money given or received when a certain sum of amount is received as a loan or given or deposited for investment.

It is given that

Principal amount of loan = $ 8000

Interest paid = $ 600

Rate = 4%

Time Period = ?

Assuming Simple Interest has been applied

I = ( P* R* T) /100

600 = ( 8000 * 4 * T ) / 100

60000 = 8000 * 4 * T

T = 1.875 years

T = 1.9 years rounded to 1 decimal

T = 22.5 months

Therefore it took 1.9 years to pay back the loan.

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