Question

MEDAL GIVEN
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Randall is saving for a $700 dirt bike. He has already saved $125 when he sees that the bike he wants is on sale for $550. He decides to ask his Dad for a loan to cover the rest of the cost. His father lends Randall the money at a simple interest rate of 3% per year.

How much does Randall wind up paying to his Dad if he waits two years to pay back the entire loan plus interest?

A. $437.75
B. $450.50
C. $566.50
D. $583.00

Answer 1

@petrolinacarbon you know :o

Answer 2

B

Answer 3

@vanessagilbert1023 can you explain

Answer 4

Randall borrows: 550-125 = $425
After 1 year the interest is 425 * 3/100 = $12.75
1st year is $425 + $12.75 = $437.75
Do same for second year
Interest = $437.75 * 3/100 = $13.13
$437.75 + $13.13 = $450.88

Answer 5

@vanessagilbert1023 thanks (: