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She would have to pay the sum of $197.91 monthly
The rate(r) of payment is = 12%
The time(t) to pay off her student loan = 4 years
Simple interest (si) amount = $195
But,
[tex]si = \frac{p \times t \times r}{100} [/tex]
Make p the subject of formula,
[tex]p = \frac{si \times 100}{t \times r} [/tex]
[tex]p = \frac{195 \times 100}{4 \times 12} [/tex]
[tex]p = \frac{19500}{48} [/tex]
p = $406.25
406.25 × 48months (4years)
Kim has to pay $406.25 monthly to achieve the loan of $19500.
But she has the balance of $10,000, therefore the amount of remaining = 19500 - 10000
= $9,500
Therefore, the amount she will pay monthly is = 9500/48
= $197.91
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