Question

The following information is known about a loan.

Time = 7 years
Interest rate = 6%
Interest = $840.00

What was the principal on the loan?
$200.00
$352.80
$1,862.50
$2,000.00

Answer 1

Well lets focus on this part for now,we know it states "interest rate = 6%"

You wanna divide the interest rate which is (6)% by (100)

\[6\div100=0.06\]

Multiply the interest rate which is now (0.06) by the "Time = 7 years"


\[0.06\times7=0.42\]

Divide the "Interest = $840.00" by (0.42)

\[840.00\div0.42=2,000\]

(2,000) can also be written as (2,000.00)

The principal on the loan was D.)$2,000.00.