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20 April, 11:28

Tim is borrowing $3500 and will pay it back at the end of 4 years. The lender asks that Tim pay simple interest of 3.5% annually. Using the simple interest formula, determine how much interest Tim will have to pay back in addition to the $3500 principal amount.

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  1. 20 April, 11:57
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    Answer: the amount of interest that he would pay is $490

    Step-by-step explanation:

    The formula for determining simple interest is expressed as

    I = PRT/100

    Where

    I represents interest paid on the loan or amount borrowed.

    P represents the principal or amount taken as loan or borrowed.

    R represents interest rate on the loan.

    T represents the duration of the loan in years.

    From the information given,

    P = $3500

    R = 3.5%

    T = 4 years

    Therefore,

    I = (3500 * 3.5 * 4) / 100

    I = $490
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