Answer:
The carpenter earned an extra $100.
Explanation:
Since this problem deals with a one-year loan with an yearly interest rate, it can be treated as a simple interest problem. For simple interests, the final value (Vf) can be found by multiplying the initial value (Vi) by one plus the interest rate (i) as shown below:
To find how much extra money the carpenter made in the first year, one should subtract the final value of loan from the $2,000 dollars down payment plus the extra $400 he collected for the year
.
Therefore, the carpenter earned an extra $100.