Question

If $10,500 is borrowed for 5 years at an annual simple interest rate of 1.73%, how much interest will be paid if the entire loan is paid off at the end of the fifth year?

Answer 1

So, yearly $2100 is paid, plus the 1.73% interest, so 1.73% interest is $2136.33every year interest stacks on itself so youll take 1.73% of the year 1 total with interest. 

Year 1 total: $2136.33
Year 2 total:$2173.29
Year 3 total:$2210.89
Year 4 total:$2249.14
Year 5 total:$2288.05
Total Paid After 5 years:$11057.70
Year 1 total interest:$36.33
Year 2 total interest:$36.96Year 3 total interest:$37.60Year 4 total interest:$38.25Year 5 total interest:$38.91
Total Interest paid after 5 years:$188.05