Lily's parents borrow $1,400 from the bank for a new washer and dryer the interest rate is 7.5% per year how much interest will they pay if they take 18 months to repay the loan

They would have to pay $157.50 due to interest in addition to the $1,400.

Explanation:

The initial borrowed amount was $1,400. This bank has an interest rate of 7.5% every year. This means that for every year that money is kept in this account, they must pay the bank 7.5%. To do this we must calculate how much 7.5% of $1,400 is.

7.5% of $1,400 is 0.075 * $1,400 = $105

So for every year, the interest of $105 must be paid to the bank. To calculate total interest we multiply this interest amount and the number of years.

So after 18 months (1.5 years) = $105 * 1.5 years = $157.5.

So interest gained in 18 months is $157.5 but this is only the interest amount. We must add the initial amount with this to find the total amount to be paid to the bank.

Total amount to be paid = Inital amount + Amount due to interest = $1,400 + $157.5 = $1,557.50.