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28 July, 14:22

Item 20 You have two loans, for 2 years each. The total interest for the two loans is $138. On the first loan, you pay 7.5% simple interest on a principal of $800. On the second loan, you pay 3% simple interest. What is the principal for the second loan?

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  1. 28 July, 14:24
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    Interest on first loan = 800*.075*2 = 120

    so the interest on the second loan

    = 138-120 = 18

    using the simple interest formula:

    18 = P*.03*2

    P = $300
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