Calculate the simple interest on a $4,000 loan at an interest rate of 8 percent after 2 years.(1 point)

Question

Responses

$640
$640

$320
$320

$6,400
$6,400

$64,000

Answer 1

To calculate the simple interest, we can use the formula:

Simple Interest = Principal * Interest Rate * Time

Here,
Principal = $4,000
Interest Rate = 8% = 0.08
Time = 2 years

Plugging in the values into the formula:

Simple Interest = $4,000 * 0.08 * 2

Simple Interest = $640

Therefore, the simple interest on a $4,000 loan at an interest rate of 8 percent after 2 years is $640.