$31.5. Option C is correct.
The formula for calculating the simple interest on the amount borrowed is expressed as:
[tex]I=\text{PRT}[/tex]where:
• P is the ,principal, (the amount borrowed)
,• R is the ,rate ,(in decimal)
,• T is the ,time, in years
Given the following parameters:
P = $1,200
R = 10.5% = 0.105
T = 3/12 = 1/4 year
Substitute the given parameters into the formula to have:
[tex]\begin{gathered} I=1200\times0.105\times\frac{1}{4} \\ I=1200\times0.105\times0.25 \\ I=\$31.5 \end{gathered}[/tex]Hence the interest that she pays for the loan is $31.5
