Question

Mike has a loan of $36,320. This loan has a simple interest rate of 6% per year. What is the

amount of interest that will be charged on this loan at the end of the first year?

Answer 1

$2,179.2

Explanation:

Given;

Loan = $36,320 (Principal)

Rate R = 6% = 0.06

Time T = 1year

Required

Interest that will be charged on this loan at the end of the first year

Using the formula for calculating simple interest as;

SI = PRT/100

SI = 36,320 * 6 * 1/100

SI = 0.06 * 36,320

SI = $2,179.2

Hence the amount of interest that will be charged on this loan at the end of the first year is $2,179.2