juanita borrowed $600 to purchase a new computer. she was charged 7% interest for two years. she used the…
juanita borrowed $600 to purchase a new computer. she was charged 7% interest for two years. she used the simple - interest formula to find the interest.\n$i = 600(7)(2)$\nwhat error did juanita make and how will her error affect the interest she calculates? explain.
Answer
Explanation:
Step1: Recall simple - interest formula
The simple - interest formula is $I = Prt$, where $P$ is the principal amount, $r$ is the annual interest rate (in decimal form), and $t$ is the time in years. Here, $P=$600$, $r = 7%=0.07$, and $t = 2$ years.
Step2: Identify Juanita's error
Juanita used $r = 7$ instead of converting the percentage $7%$ to its decimal form $0.07$. Her formula should be $I=600\times0.07\times2$.
Step3: Analyze the effect of the error
Since she used $r = 7$ instead of $r = 0.07$, the value she will calculate for the interest will be 100 times larger than the actual interest. The actual interest is $I = 600\times0.07\times2=600\times0.14 = 84$. But her calculation $I = 600\times7\times2=8400$, which is 100 times the correct value.
Answer:
Juanita did not convert the 7% interest rate to its decimal form (0.07). Her calculated interest will be 100 times larger than the actual interest.