A bank offers a simple interest loan of $35 000 with monthly repayments of $545. a. Calculate what the rate of simple interest is if the loan is paid in full in 15 years.
b. After 5 years of payments the bank offers to reduce the total time of the loan to 12 years if the
monthly payments are increased to $650. Calculate how much interest would be paid over the life of
the loan under this arrangement.
c. Calculate the average rate of simple interest over the 12 years under the new arrangement.