Joe borrowed $8,000 from the bank at a rate of 7% simple interest per year. How much interest did he pay in 5 years?

Answer

$700

Step-by-step explanation:

From the Formula:

I = Pin

where : I - interest

P - principal

i - the interest rate

n - the number of years

I = Pin, plug in the given data as provided in the problem.

P = $8,000

i = 0.07 per yea

I = ($2,000)(0.07/year)(5 years)

= ($8,000)(0.07)(5)

= $2.800