Cory owes $1,000 to his bank. During the time of his loan, he is charged a real of 12% simple annual interest. If he does not make any payments on his loan, which table shows the relationship between the amount he owes and the number of months?
Answers
Given : Cory owes $1,000 to his bank. During the time of his loan, he is charged a real of 12% simple annual interest
To find : If he does not make any payments on his loan, draw table showing the relationship between the amount he owes and the number of months
Solution:
Loan amount P = $ 1000
Rate of interest R = 12 % per annum
SI = P * R * T /100
one month T = (1/12) Years
Interest per month = 1000 * 12 * (1/12) /100 = $ 10
Hence interest is charges $ 10 per month
Cory owes to bank the loan amount and interest
Cory owes = 1000 + 10 n
where n is the number of months
Month Amount
0 1000
1 1010
2 1020
3 1030
4 1040
and so on
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