Question 219513
Recall that the simple interest formula is {{{I=Prt}}} where 'I' is the interest, P is the balance/principal, 'r' is the interest rate, and 't' is the time in years.


So let's first find out how much interest he paid:


{{{I=Prt}}} Start with the given formula.



{{{I=12000(0.08)(4)}}} Plug in {{{P=12000}}}, {{{r=0.08}}}, and {{{t=4}}}



{{{I=3840}}} Multiply



So he paid $3,840 in interest alone.



Now just add this to the amount he borrowed (since he has to pay that back too) to get: {{{12000+3840=15840}}}



So Peter paid back $15,840 total.