Question

katelyns older brother borrowed money for school. he took out a loan that charges 6% simple interest. he will end up paying $720 in interest after 6 years. how much did katelyns brother borrow for school?

Explanation:

Step1: Recall simple interest formula

The simple interest formula is $I = P \times r \times t$, where $I$ = interest, $P$ = principal (amount borrowed), $r$ = annual interest rate (decimal), $t$ = time in years.

Step2: Convert rate to decimal

$r = \frac{6\%}{100} = 0.06$

Step3: Rearrange formula to solve for $P$

$P = \frac{I}{r \times t}$

Step4: Substitute given values

$P = \frac{720}{0.06 \times 6}$

Step5: Calculate denominator and final value

$0.06 \times 6 = 0.36$, so $P = \frac{720}{0.36} = 2000$

Answer:

$\$2000$