Interest is compounded annually. What is the total amount of interest on a $7,000 note payable at the end of five years at 8%?
A) $3,000
B) $3,285
C) $7,000
D) $3,791

Question

Quizplus · Accepted Answer

The total amount of interest on a $7,000 note payable at the end of five years at 8% is $3,285. This is calculated as follows:Interest = Principal x Rate x TimeInterest = $7,000 x 0.08 x 5Interest = $3,285

Interest Is Compounded Annually