Question

Maggie takes out a loan from the bank for $7,500. The simple interest on the loan is 5%. She agrees to pay the loan back over the course of 3 year. What is the total amount of money that Maggie will pay back after 3 years? (Use I = prt)

Answer 1

First, we need to calculate the interest Maggie will pay. Using the formula I = prt, we can find that:

I = (0.05)(7,500)(3)
I = 1,125

So Maggie will pay $1,125 in interest over the course of 3 years.

Now, we need to add the interest to the original loan amount to find the total amount Maggie will pay back.

Total amount = loan amount + interest
Total amount = 7,500 + 1,125
Total amount = 8,625

Therefore, Maggie will pay back a total of $8,625 after 3 years.