Question

Elsa took out a 2-year loan to buy a car at 6% simple interest rate. If she has to pay $264vin interest, how much principal did she borrow?

Answer 1

Answer:

The Principal amount that Elsa borrowed for the car loan is $2200 .

Step-by-step explanation:

Given as :

The time period for the car loan = t = 2 years

The rate of interest applied = r = 6% at simple interest

The interest amount = S.I = $264

Let The principal amount which Elsa borrowed = $p

Now, From simple interest method

Simple Interest = $\dfrac{\textrm principal\times \textrm rate\times \textrm time}{100}$

Or, S.I = $\dfrac{\textrm p\times \textrm r\times \textrm t}{100}$

Or, $264 = $\dfrac{\textrm p\times \textrm 6\times \textrm 2}{100}$

Or, $264 × 100 = 12 × p

Or,  p = $\dfrac{264\times 100}{12}$

∴ p = $2200

So, The principal she borrowed = p = $2200

Hence,The Principal amount that Elsa borrowed for the car loan is $2200 . Answer