June Davison borrowed $9,000 for 31/2 years at 12% simple interest. Find the interest

Question

June Davison borrowed $9,000 for 31/2 years at 12% simple interest.  Find the interest

anonymous · Answer

when we are just told interest, we assume it is yearly.
simple interest is different from compound interest.

simple interest is always calculated from the initial borrowed amount every year whereas compound is calculated from the updated amount that gets larger with every interest calculation [at the end of every year].

I = PV*i*N

I = Interst
PV = Present value
i = interest rate [yearly]
N = amount of years

I = 9000(0.12)(3.5) = $3780

anonymous · Answer

Thank you for the really good explanation. :D

anonymous · Answer

glad i could help ^_^