Solve the problem. Assume that simple interest is being calculated in each case. Round your answer to the nearest cent.
-Allan borrowed $6500 from his father to buy a car. He repaid him after 4 months with interest of 2% per year. Find the total amount he repaid.
A) $6630.00
B) $6543.33
C) $6532.50
D) $43.33

Question

Quizplus · Accepted Answer

The interest $I$ can be calculated using the formula $I = P \times r \times t$, where $P$ is the principal amount ($6500), $r$ is the annual interest rate (2% or 0.02), and $t$ is the time in years. For 4 months, $t = \frac{4}{12}$ or $\frac{1}{3}$ year. So, $I = 6500 \times 0.02 \times \frac{1}{3} = 43.33$. The total amount repaid is the principal plus interest: $6500 + $43.33 = $6543.33.

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