Suppose First National Bank makes a one-year simple loan of $1,000 at 7% interest to Harry's Restaurant.At the end of one year Harry's Restaurant will pay First National
A) $934.58.
B) $1,007.
C) $1,070.
D) $1,700.

Question

Quizplus · Accepted Answer

The interest for one year on a $1,000 loan at 7% is $70 (0.07 * $1,000), so the total repayment amount is $1,000 (principal) + $70 (interest) = $1,070.

Suppose First National Bank Makes a One-Year Simple Loan of $1,000