Question

Juanita and Carlos borrowed $48000 at a simple interest rate of 11% for a period of 2 years. What was the interest?

Answer 1

$1056

Answer 2

Is that 11% per annum?

Answer 3

or 11% total?

Answer 4

i considered it as 11% per annum

Answer 5

So at the end of 1 year, borrower pays the interest?

Answer 6

no, at the end of 2 years

Answer 7

So the first years interest is added to the loan amount?

Answer 8

@estudier please can you try my problem??

Answer 9

er..i dunno much bout that......i simply used the formula:
Simple interest= (principle x rate xno of years)/100

Answer 10

Let's say it is 11% pa (normally simple interest is just a total figure) and the interest is added to the loan:

48,000 by 11% is 5280 so new principal is
53280 by 11% is 5860.80 so total interest is

5280 + 5860.80 = 11,140,80.


(otherwise it is just a flat 11% or 5280)

Answer 11

and,
amount=principle+interest
in this case, the amount is $49056 which Juanita & Carlos have to pay at the end of 2 years

Answer 12

She only asked for the interest...

Answer 13

er...ya...sorry!!!

Answer 14

I don't know where u get 1056 from, just 10% is already 4800.

Answer 15

i dont understand.....i used the formula-
Simple interest= (principle x rate xno of years)/100

Answer 16

I used that same formula but it just doesn't seem right.

Answer 17

48000 * 11* 2/100 = 10560

Answer 18

ie the flat 5280 twice.

Answer 19

we were taught dis formula for calculating SI in school

Answer 20

I agree with the formula, I just said u can't get 1056 using it....

Answer 21

So I think the answer is either 5280 if the interest rate is 11.5% total or double that if it is 11% per annum.

Answer 22

Ok, so what formula am I suppose to use? I am getting so confused

Answer 23

I just said I agree with the formula.

Answer 24

well..i must have made some mistake while calculating

Answer 25

so i got 1056

Answer 26

i think its a flat rate of 11%

Answer 27

So 5280 then.

Answer 28

how did u get that? Because I am getting 1056

Answer 29

what is the formula for calculating with flat rate?

Answer 30

even i got 1056

Answer 31

but its actually 10560

Answer 32

I = rPp (interest = rate * loan amount * periods

Answer 33

That's rate per period.

Answer 34

???? i didn't quite understand

Answer 35

Which part?

Answer 36

whats rPp?

Answer 37

rate per period

Answer 38

rate * loan amount * periods

Answer 39

ok thanks

Answer 40

rate per period * loan amount * periods

Answer 41

So if u are saying the period is 2 years and the rate for that period is 11%

48000 * 11/1000 = 5280.

Answer 42

11/100 sorry..