Question

Annie's cafe borrows $6100 at 6% for 290 days. Find the total amount that must be repaid after 290 days. (Use a 365 day year.)

Answer 1

If its 6% interest, then the answer would be $6,466. You would do this by multiplying 0.06 to 6100 and adding the product (366) to 6100.

Answer 2

General Idea:

The formula to find the Amount 'A' that need to be paid after ' t ' years for a Principal ' P ' with a annual rate of interest ' r ' is given below:

`A= P(1+r \cdot t)`

Applying the concept:

Annie's cafe borrows $6100 at 6% for 290 days.

From the above statement we can conclude,...

`P= \$6100\\ \\ r=6\%\\ \\ t=(260)/(365)`

Substituting the values of P, r and t in the formula, we get...

`A=6100 \cdot (1+6 \% \cdot (260)/(365) )\\ \\ A=6100(1+(6)/(100) \cdot (260)/(365) )=6100(1+(1560)/(36500) ) \approx 6361`

Conclusion:

The total amount that must be repaid after 290 days is approximately
`\$6361`