Answer:
Option B - $172
Step-by-step explanation:
Given : Mr. Fixit wanted to remodel his business, so he got a loan of $4,300, at a rate of 6 percent interest. He paid this loan off in 8 months.
To find : What was the total amount of interest Mr. Fixit paid?
Solution :
Applying compound interest formula,
[tex]A=P+I[/tex]
Where, [tex]A=P(1+r)^t[/tex]
Here, A is the amount
P is the principal P=$4300
r is the interest rate r=6%
t is the time = 8 months
Substitute the value in the formula,
[tex]A=4300(1+\frac{6}{1200})^8[/tex]
[tex]A=4300(1+0.005)^8[/tex]
[tex]A=4300(1.005)^8[/tex]
[tex]A=4300\times 1.04[/tex]
[tex]A=4472[/tex]
Now, We find the interest
[tex]4472=4300+I[/tex]
[tex]I=4472-4300[/tex]
[tex]I=\$172[/tex]
Total amount of interest Mr. Fixit paid is $172.
Therefore, Option B is correct.
