Suppose you take out a loan of $2,600 at 8.3% simple interest. you promise to pay back the loan in two equal payments. the first payment is after 6 months and the last payment is at the end of the year. how much is your first payment?

First we need to calculate the interest at the end of 6 months using the formula of simple interest which is
I=prt
I interest paid?
P principle 2600
R interest rate 0.083
T time 6/12
I=2,600×0.083×(6÷12)
I=107.9

The question says that you promise to pay back the loan in two equal payments which means that you will pay the half of the loan 1300 (2600/2) plus interest.
So your first payment is
1,300+107.9=1,407.9

Hope it helps!

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