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1 October, 06:24

Ted borrowed $100 from 2 years at a 10% interest rate. How much interest will he pay on the loan? What will be the total amount due at the end of the loan?

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  1. 1 October, 09:00
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    Interest = $20

    Amount due = $120

    Step-by-step explanation:

    This is a Simple Interest problem. Simple interest is given as:

    I = (P * R * T) / 100

    Where I = interest

    P = principal or amount loaned

    R = rate of interest

    T = time elapsed

    Ted borrowed $100 from 2 years at a 10% interest rate.

    This means that P = $100, R = 10%, T = 2 years.

    Hence, the interest will be:

    I = (100 * 10 * 2) / 100

    I = 2000 / 100

    I = $20

    The interest after two years will be $20.

    Therefore, the total amount due at the end of the loan is:

    A = P + I

    A = 100 + 20 = $120

    The amount due is $120.
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