Business FinancesQuestion 330 of 1632
A contractor finances a $24,000 piece of equipment with a 4-year loan at 7% simple annual interest. What is the total interest paid over the life of the loan?
a.$1,680
b.$6,720
c.$24,000
d.$30,720
Explanation
Simple interest = Principal × Rate × Time = $24,000 × 0.07 × 4 = $6,720. The total amount repaid would be $24,000 + $6,720 = $30,720.
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