Question

Joe borrowed $2,000 from the bank at a rate of 7% simple interest per year. How much interest did he pay in 5 years?

Answer 1

The simple interest formula is I = P * r * t

P is the principal (2,000)
r is the interest rate (7% or 0.07)
t is the time (5)

2000 * 0.07 * 5 = 700

$700.00 is the interest

Joe has to pay $700.00 in interest.

Hope this helps :D