Paul borrowed $2,000 for four months at an annual interest rate of

Question

10.25%. How much must he repay at the end of four months?

Answer 1

To calculate the amount Paul must repay at the end of four months, we first need to determine the amount of interest he will owe.

First, calculate the interest for the four-month period:
Interest = Principal x Rate x Time
Interest = $2,000 x 0.1025 x (4/12) = $68.33

Now, add the interest to the principal amount to find the total amount Paul must repay:
Total repayment = Principal + Interest
Total repayment = $2,000 + $68.33 = $2,068.33

Therefore, Paul must repay $2,068.33 at the end of four months.