Question

Steph took out a simple interest loan charges 8.5% interest annually. If her original loan amount was for $30,000 and she is paying off the loan over 20 years, how much will she pay altogether

Answer 1

Answer:

The amount which Steph pays for the original loan amount and interest is $81,000 .

Step-by-step explanation:

Given as :

The original loan amount took by Steph = P = $ 30,000

The rate of interest = R = 8.5 % at simple interest

The time period of the loan = T = 20

Let The amount she pay = $ A

Now, From Simple Interest method :

Simple Interest = $\dfrac{\textrm Principal\times \textrm rate\times \textrm time}{100}$

or, SI = $\dfrac{\textrm P\times \textrm r\times \textrm T}{100}$

or, SI =  $\dfrac{\textrm 30,000\times \textrm 8.5\times \textrm 20}{100}$

or, SI = $\frac{5100000}{100}$

∴ Simple Interest = SI = $51,000

Now, Amount = Original amount + Simple Interest

Or, A = $30,000 + $51,000

Or, A = $81,000

So, The amount she pay altogether = A = $81,000

Hence The amount which Steph pays for the original loan amount and interest is $81,000 . Answer