Question
A family purchases a camping RV for $24,000. They borrow the money from a credit union at an 11% simple interest rate for 4 years. How much in interest will the family pay in total? Round to the nearest whole dollar.(1 point)
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Answers
GPT-4o mini
To calculate the total interest paid on a loan using simple interest, you can use the formula:
\[ \text{Interest} = P \times r \times t \]
where:
- \( P \) is the principal amount (the initial amount borrowed),
- \( r \) is the annual interest rate (in decimal form),
- \( t \) is the time in years.
In this case:
- \( P = 24,000 \)
- \( r = 11\% = 0.11 \)
- \( t = 4 \)
Now plug these values into the formula:
\[
\text{Interest} = 24000 \times 0.11 \times 4
\]
\[
\text{Interest} = 24000 \times 0.44
\]
\[
\text{Interest} = 10560
\]
The total interest that the family will pay is **$10,560**.
\[ \text{Interest} = P \times r \times t \]
where:
- \( P \) is the principal amount (the initial amount borrowed),
- \( r \) is the annual interest rate (in decimal form),
- \( t \) is the time in years.
In this case:
- \( P = 24,000 \)
- \( r = 11\% = 0.11 \)
- \( t = 4 \)
Now plug these values into the formula:
\[
\text{Interest} = 24000 \times 0.11 \times 4
\]
\[
\text{Interest} = 24000 \times 0.44
\]
\[
\text{Interest} = 10560
\]
The total interest that the family will pay is **$10,560**.