Question

A student borrows $12,000 at a simple interest rate of 4.5% for 5 years. How much interest is ones at the end of 5 years, and what amount of money must be repaid at the end of the 5 year period

Answer 1

Answer:

$12,000(1+\frac{4.5}{100}*5)=12,000(1.225)=\ 14,700$

Step-by-step explanation:

Simple interest is where interest is only accumulated on the principle, so at 4.5% for 5 years, 22.5% is added to the principal.