Solve. Round all dollar amounts to the nearest cent, if necessary.
-An entrepreneur borrowed $25,000 from a bank at 8% for 6 months to get a project off the ground. Find the total amount due the bank the end of the 6-month period.

Question

Quizplus · Accepted Answer

We can use the formula for simple interest to find the amount due at the end of 6 months:
I = Prt
where
I = interest
P = principal = $25,000
r = rate = 8% per year = 0.08/2 = 0.04 per 6 months
t = time = 6 months

I = 25000(0.04)(6/12) = $500

So, the total amount due at the end of 6 months is $25,000 + $500 = $26,000. Option C is the correct answer.

Solve Round All Dollar Amounts to the Nearest Cent, If