Using simple interest, it is found that Alexa will owe her aunt $11,000 after 2 years.
The amount of money after t years in simple interest is modeled by:
[tex]A(t) = A(0)(1 + rt)[/tex]
In which:
- A(0) is the initial amount.
- r is the interest rate, as a decimal.
In this problem:
- Alexa borrows $10,000 from her aunt and they agree, hence [tex]A(0) = 10000[/tex].
- 5% simple interest, hence [tex]r = 0.05[/tex].
- She will pay back after 2 years, hence [tex]t = 2[/tex].
Then:
[tex]A(t) = A(0)(1 + rt)[/tex]
[tex]A(t) = 10000[1 + 0.05(2)][/tex]
[tex]A(t) = 11000[/tex]
Alexa will owe her aunt $11,000 after 2 years.
To learn more about simple interest, you can take a look at https://brainly.com/question/25296782
