Help with interest problem?

Jane Doe borrows $20,900 from her bank to open a bakery. She agrees to repay the money in 18 months with simple annual interest of 10.4%.

(a) How much must she pay the bank in 18 months?

(b) How much of the amount in part (a) is interest?

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  • mom
    Lv 7
    1 decade ago
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    Jane Doe borrows $20,900 from her bank to open a bakery. She agrees to repay the money in 18 months with simple annual interest of 10.4%.

    (a) How much must she pay the bank in 18 months?

    (b) How much of the amount in part (a) is interest?

    I = 20900(.104)(1.5)

    I=3260.40

    she will pay the bank $24,160.40

    Interest is $3260.40

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