The formula for calculating a simple interest is;
[tex]\begin{gathered} I=P\times R\times T \\ P=500,R=0.04,T=0.5 \\ \text{Please note that the money was repayed after 6 months} \\ \text{Therefore, T which is time shall be half (6 months is half of 1 year)} \\ I=500\times0.04\times0.5 \\ I=10 \end{gathered}[/tex]The total amount the cousin owes Chelsea is $510
She would repay the principal plus the interest calculated, and that is $500 plus $10, which equals $510
