A secondary school has a £20,000 loan for new computer equipment. At an annual simple interest rate of 3%, the school pays £600 interest for one year. The lender raises the interest rate to 4.5%.
Calculate the additional interest cost to the school for one year.
82 exam-style questions on OCR GCSE Economics 2.8 The role of money and financial markets, covering 2.8.1 Money as a medium of exchange, 2.8.2 Role of the financial sector, 2.8.3 Importance of the financial sector, 2.8.4 Interest rates and saving, borrowing, investment, and 2.8.5 Effect of interest rate changes. Each one has a worked solution and a mark scheme showing where the marks go.