The problem involves calculating simple interest on a loan. Here's how we can proceed:

Given:

• Principal (P) = $5000
• Interest rate (r) = 3% annually = 0.03
• Time (t) = 6 years

(a) To find the total interest Jessica will have to pay, use the formula for simple interest:

$I = P \times r \times t$

Substituting the values: $I = 5000 \times 0.03 \times 6$ $I = 900$ So, Jessica will have to pay $900 in interest.

(b) To find the total repayment amount (including interest), use the formula:

$\text{Total Repayment} = P + I$

Substituting the values: $\text{Total Repayment} = 5000 + 900 = 5900$ So, the total repayment amount, including interest, will be $5900.

Would you like more details or have any questions about this process?

Related Questions:

1. How does the formula for simple interest differ from compound interest?
2. What are the key factors affecting the amount of interest in a simple interest loan?
3. How would the interest and repayment change if the interest rate were higher?
4. What other types of loans might use simple interest rather than compound interest?
5. How can you calculate the interest if you are paying it monthly instead of at the end?

Tip: Always ensure that your time (t) is in the correct unit (years) when calculating interest!