To calculate the simple interest on a loan for $1800 with a 6% interest rate that will be paid back after 2 years, you can use the formula for simple interest:
Simple Interest (SI) = Principal (P) * Rate (R) * Time (T)
Given:
Principal (P) = $1800
Rate (R) = 6% = 0.06 (decimal form)
Time (T) = 2 years
Substitute the values into the formula:
SI = $1800 * 0.06 * 2
SI = $216
The total amount to be paid back after 2 years will be the principal plus the simple interest:
Total Amount = Principal + Simple Interest
Total Amount = $1800 + $216
Total Amount = $2016
To find the monthly payments, you divide the total amount by the number of months in 2 years (24 months):
Monthly Payment = Total Amount / Number of Months
Monthly Payment = $2016 / 24
Monthly Payment = $84
Therefore, the monthly payments for a $1800 loan with a 6% interest rate that will be paid back after 2 years would be $84.
