Arnold borrowed $7890 at 11.5 percent for five years. How much did Arnold Pay in interest?A.$2,199B.$2,300C.$1,150D.$2.520

Answer:Option D. $2520 is correctStep-by-step explanation:Principal value = $7890Rate of interest = 11.5 annually[tex]\text{Monthly Rate of Interest = }\frac{11.5}{12}=0.96\%=0.0096[/tex]Time = 5 years⇒ n = 60 months [tex]\text{Monthly Payment = }\frac{rate\times \text{Principal value}}{1-(1+r)^{-n}}\\\\\text{Monthly payment = }\frac{0.0096\times 7890}{1-(1+0.0096)^{-60}} \\\\\implies\text{Monthly Payment = }\$173.50[/tex]Total payment made by Arnold = No. of months × Monthly Payment⇒ Total Payment = 60 × 173.50⇒ Total Payment = $10410Money borrowed = $7890Hence, Amount of interest = Total payment - Amount borrowed⇒ Interest = 10410 - 7890⇒ Interest = $2520Therefore, Option D. $2520 is correct