Answer:
$162.50
Step-by-step explanation:
The total amount to be paid is 7500+5(7500)(0.06)=$9750.
There were a total of (5)(12)=60 payments, so each payment is 9750/60 = $162.50.
She paid $162.5 each month to pay off her loan.
Simple interest is a way to figure out how much interest will be charged on a sum of money at a specific rate and for a specific duration of time.
Unlike compound interest, which adds the interest from the principal of prior years to determine the interest of the following year, the principal amount in simple interest remains constant.
Given that,
Principle amount (P) = $7500
Rate of interest (R) = 6%
Time period (T) = 5 years
Simple interest is given by = PRT/100
So,
Interest = 7500 × 6 × 5/100 = 2250
Therefore;
Total payout = Principle amount + interest
Total payout = 7500 + 2250 = $9750
Now, since she is paying equal amount of monthly payments
Number of months in the 5 year = 5 × 12 = 60
So,
Monthly payment = 9750/60 = $162.5
Hence "She paid $162.5 each month to pay off her loan".
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