Payment Every Month = $2,514.58
Total of 1 Payments = $2,514.58
Total Interest = $14.58
What is simple intertest ?
Simple interest is calculated based on the principal of a loan or the initial deposit into a savings account. Simple interest doesn't compound, therefore a creditor will only charge interest on the principal sum, and a borrower will never be required to pay further interest on the interest that has already accumulated.
Solution:
Principal value = $2500
Interest rate = 7%
Time = One month
Formula for simple interest calculation:
[tex]=\frac{Principalamount*rate *time}{100} \\=\frac{2500*7*(\frac{1}{12}) }{100}\\ =14.588[/tex]
Total Simple interest on $2500 for month $14.588.
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