Question

Scott takes a student loan to go college after high school. If he pays $750 in interest at a rate of 3%, how much must the loan have been for originally?

Answer 1

Answer:

$728.16

Step-by-step explanation:

If the original loan was P

At R%, Amount to be paid, A = P(1 + $\frac{R}{100}$ )

=> 750 =P(1 + 0.03) = 1.03P

∴ P = $\frac{750}{1.03}$ = 728.16

Answer 2

Given:

Scott takes a student loan to go college after high school.

Interest paid by Scott = $750

Rate of Interest = 3%

To find :

The loan amount taken by Scott originally.

Formula to be used:

Interest = $\frac{PNR}{100}$

Solution:

Let P be the loan amount taken by Scott originally,

Interest = $\frac{PNR}{100}$

Interest paid by Scott = $750

N = 1 year

Rate of Interest = 3%

Therefore,

750 = $\frac{P (1)(3)}{100}$

750 × 100 = P × 3

$\frac{75000 }{3}$ = P

P =  $25000

Therefore, The loan amount was $25000

Final answer:

Scott takes a student loan of  $25000 to go college after high school.