Question

If a firm borrows ​$8 comma 000 from households at an annual interest rate of 6 ​percent, how much will the firm pay in interest payments each​ year?

Answer 1

Answer:

The firm will pay 480 dollars each year as interest payment.

Explanation:

The interest amount is calculated by multiplying the rate of interest with the amount borrowed. In problem loan is 8,000 dollars and rate of interest is 6%, so the interest amount will be calculated as follow

Interest payment = 8,000 * 6% = 480 dollars