Answer:
$600
Step-by-step explanation:
Simple Interest Rate: A = P(1 + RT)
A [tex]\longmapsto[/tex] Total Value
P [tex]\longmapsto[/tex] Principle
R [tex]\longmapsto[/tex] Rate
T [tex]\longmapsto[/tex] Time
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Step 1: Insert Values
Let's plug the info we have into the formula:
A = 4000(1 + 0.05(3))
A = 4000 + 4000(0.15)
A = 4000 + 600
A = 4600
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Step 2: Finding the Interest
So the total value she ends up with $4600, but we want to find the extra value, or interest, she has to pay.
To find this we subtract the principle from the new value:
4600 - 4000 = 600
Liz has to pay $600.
-Chetan K
