Question

If you borrow $100 for 3 years with an annual interest rate of 9% how much will you pay altogether.

Answer 1

$100(1.09)^3=129.5029$ or $129.50

Answer 2

Here we have o find simple interest ( SI )

SI = P x R x T / 100
P = $100
R = 9
T = 3

SI = 100 x 9 x 3 / 100
= 2700 / 100
= 27 for the 1st year

For 3 years 27 x 3
= 81
So 181 is what you have to pay altogether.