Answer
(a) interest = $\$300$
(b) $\$63.89$ per month
Work Step by Step
(a) Find the interest using the formula $I=Prt$ where $P$=principal loan amount, $r=$annual interest rate, and $t$=time in years.
$I=\$2000 \times 5\% \times 3
\\=\$2000 \times 0.05 \times 3
\\=\$300$
(b) Find the monthly payment using the formula $\text{payment amount} = \dfrac{\text{principal + interest}}{\text{loan period in months}}$.
monthly payment
$= \dfrac{\$2000 + \$300}{3(12)}
\\=\dfrac{\$2300}{36}
\\=\$63.\overline{8}
\\\approx\$63.89$
