Question

Victor borrowed money at 5.25 percent simple annual interest. At the end of the year, the interest on the loan is $255.94. What was the amount of the loan?

Answer 1

simple annual interest formula:

amount of interest = P(rt)
where P is the principal (which you'll solve for), r is the interest rate as a decimal (0.0525) and t is time (1 year). plug in interest, interest rate, and time, then solve for P.