The customer will save interest by paying off a credit debt is $1,800 at the end of 1 year instead of at the end of 3 years
What is simple interest?
Simple interest is the concept that is used in many companies such as banking, finance, automobile, and so on.
A customer has a credit card that charges 18% simple interest every year.
The customer saves by paying off a credit card debt of $5,000 at the end of 1 year instead of at the end of 3 years.
Interest for three years will be
[tex]\rm A_3 = \dfrac{PRT}{100}\\\\\\A_3= \dfrac{5000*18*3}{100}\\\\\\A_3= 2700[/tex]
Interest for one year will be
[tex]\rm A_1 = \dfrac{PRT}{100}\\\\\\A_1= \dfrac{5000*18*1}{100}\\\\\\A_1= 900[/tex]
The saved amount will be
A = A₃ - A₁
A = 2700 - 900
A = 1800
The customer will save interest by paying off a credit debt is $1,800 at the end of 1 year instead of at the end of 3 years
More about the simple interest link is given below.
https://brainly.com/question/2793278
