Bob Marby purchased a TV from Tryton Sales and signed a 2-year,6% promissory note for $1,200.What is the amount required to pay off the note if it accrues simple interest?
A)$1,212
B)$1,272
C)$1,344
D)$1,348

Question

Quizplus · Accepted Answer

The simple interest formula is: 
Interest = (Principal x Rate x Time)

In this case, the principal is $1,200, the rate is 6%, and the time is 2 years. 
Interest = ($1,200 x 0.06 x 2) = $144

So, the total amount required to pay off the note is:
Total amount = Principal + Interest = $1,200 + $144 = $1,344

Hence, the correct answer is C.

Bob Marby Purchased a TV from Tryton Sales and Signed