After taking out a one year loan with an annual interest rate of 5 percent, Tommy pays $2,100 back to the bank. The principal of the loan must be ___________ and the interest payment must be ___________.
A) $2,000; $100
B) $2,100; $100
C) $100; $2,100
D) $100; $2,000

Question

Quizplus · Accepted Answer

The principal is the original amount borrowed, which is $2,000. The interest payment is 5% of $2,000, which is $100. Therefore, Tommy pays back $2,100 in total.

After Taking Out a One Year Loan with an Annual