M = Maturity Value ======> $5,989.50
P = Principal Loan Amount =====> $7,972.02
I = Annual Interest Rate =======> 10% (or, .10 ) ===> $1,982.52
N = Number of Years ======> 3 years
M = P( 1 + i )^n ======> Solved for Amount Borrowed:
Solution: M = $5989.50(1 + .10 )^3 ======> M = $7,972.0245 ====> $7,972.02 Bill Abel Borrowed.
Equation: M = P( 1 + i )^n
Let's solve your equation step-by-step.
m = 5989.5(1 + 0.1)3
Step 1: Simplify both sides of the equation.
Add the numbers: 1 + 0.1 = 1.1
m = 1.1^3 = $5989.50
1.1^3 = 1.331
m = 1.331 * 5989.50
Multiply the Numbers:
5989.50 * 1.331 = 7972.0245
m = $7972.0245 ======> $7,972.02
Answer: =======> m = $7972.0245 =====> $7,972.02 Would be the amount Bill Abel Borrowed.
The Amount of Interest Bill Abel would have paid ======> $1,982.52
Check: Maturity Amount + Annual For total cost of 3 Years = Amount Borrowed
$5989.50 + $1972.52
m = $7972.02
Hope that helps!!!! : )