Answer :
We have been given that Mia agrees to borrow a 3-year loan with 4% simple interest to buy a motorcycle.
A. Mia paid a total of $444 in interest. We are asked to find the amount of money borrowed by Mia initially.
We will use simple interest formula to solve our given problem.
[tex]I=Prt[/tex], where,
I = Amount of interest,
P = Principal amount,
r = Annual interest rate in decimal form,
t = Time in years.
[tex]4\%=\frac{4}{100}=0.04[/tex]
[tex]444=P\cdot 0.04\cdot 3[/tex]
[tex]444=0.12P[/tex]
[tex]\frac{444}{0.12}=\frac{0.12P}{0.12}[/tex]
[tex]P=3700[/tex]
Therefore, Mia initially borrowed $3700.
B. For part B we need to find amount interest paid by Mia at an interest rate of 5%.
[tex]5\%=\frac{5}{100}=0.05[/tex]
[tex]I=3700\cdot 0.05\cdot 3[/tex]
[tex]I=3700\cdot 0.15[/tex]
[tex]I=555[/tex]
Therefore, Mia will pay an amount of $55 in interest.
Answer:
Part A: $3,700
Part B: $55
Step-by-step explanation:
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