Lets write an equation describing the interest rate y: y = 125(25%)x where x is the number of years, lets simplify that equation y = (125)(25/100)x y = 31.25x now lets substitute the maximum amount that we want to pay and solve for x, the number of years: 62.50 = <span>31.25x x = </span>62.50/<span>31.25 x = 2 therefore, the loan needs to be paid in 2 years in order to pay $62.50 of interest</span>