You lend a friend $20,000 for a year at an annual interest rate of 5%. At the end of the year your friend must pay you ________ in interest.

A) $133
B) $750
C) $1,000
D) $1,900

Question

You lend a friend $20,000 for a year at an annual interest rate of 5%. At the end of the year your friend must pay you ________ in interest.A)  $133B)  $750C)  $1,000D)  $1,900

Kamalpreet Singh · Accepted Answer

Final Answer : C, Explanation :  The interest can be calculated using the formula: Interest = Principal × Rate × Time. Here, Principal = $20,000, Rate = 5% (or 0.05 as a decimal), and Time = 1 year. So, Interest = $20,000 × 0.05 × 1 = $1,000.

You lend a friend $20,000 for a year at an annual interest rate of 5%. At the end of the year your friend must pay you ________ in interest.

A) $133
B) $750
C) $1,000
D) $1,900

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Learning Objectives

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