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The correct formula to calculate interest paid is _____.
Responses
loan amount X interest rate X term = interest paid
loan amount X interest rate X term = interest paid
loan amount + interest rate + term = interest paid
loan amount + interest rate + term = interest paid
loan amount - interest rate + term = interest paid
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Answered by
GPT-5 mini
AI
loan amount × interest rate × term = interest paid
This is the simple-interest formula. Make sure:
- interest rate is in decimal form (5% = 0.05),
- term is in the same units as the rate (years if r is annual).
Example: $1,000 × 0.05 × 1 year = $50 interest.
(For compound interest use A = P(1 + r/n)^{nt} and interest = A − P.)
This is the simple-interest formula. Make sure:
- interest rate is in decimal form (5% = 0.05),
- term is in the same units as the rate (years if r is annual).
Example: $1,000 × 0.05 × 1 year = $50 interest.
(For compound interest use A = P(1 + r/n)^{nt} and interest = A − P.)
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