Item 20 You have two loans, for 2 years each. The total interest for the two loans is $138. On the first loan, you pay 7.5% simple interest on a principal of $800. On the second loan, you pay 3% simple interest. What is the principal for the second loan?

Question

Mathematics

Desiree Underwood

4 May, 19:47

Item 20 You have two loans, for 2 years each. The total interest for the two loans is $138. On the first loan, you pay 7.5% simple interest on a principal of $800. On the second loan, you pay 3% simple interest. What is the principal for the second loan?

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Answers (1)

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John Daugherty · Answer 1

Interest on first loan = 800*.075*2 = 120

so the interest on the second loan

= 138-120 = 18

using the simple interest formula:

18 = P*.03*2

P = $300