Question

For a car loan using simple interest at a given rate, the amount of interest charged varies jointly with the loan amount (also known as the principal) and the time of the loan (in years). If a $20,000 car loan earns $2240 in simple interest over 4 years, how much interest will a $24,000 car loan earn over 7 years?

Answer 1

I = p*r*t

"If a $20,000 car loan earns $2240 in simple interest over 4 years"

p = 20000
I = 2240
t = 4

Substituting

2240 = 20000*r*4

Solve for r and answer the question.