A farmer meets his short-term capital needs by establishing a line of credit and borrowing as follows. All the corrowed money plus interest is paid back on August 1 when the crop is sold. Calculate the total amount of interest paid, assuming a 6% annual interest rate. Assume interest accrues on only the outstanding balance (ie. interest does not compound). March 1 April 1 May 1 July 1 O $1150 $1050 O $1075 O $1175 $20,000 $8,000 $10,000 $5,000

A farmer meets his short-term capital needs by establishing a line of credit and borrowing as follows. All the korrowed money plus interest is paid back on August 1 when the crop is sold. Calculate the total amount of interest paid, assuming a 6% annual interest rate. Assume interest accrues on only the outstanding balance (ie. interest does not compound). $1150 $1050 $1075 $1175