Question

In order to finance a new product line, a company that makes high-temperature ball bearings borrowed $2 million at 11% per year compound interest. The company repaid the loan in a lump sum amount after 3 years.Note: This is a multi-part question. Once an answer is submitted, you will be unable to return to this part.What was the amount of payment

Answer 1

the amount of payment is $2,735,262

Step-by-step explanation:

The computation of the amount of payment is as follows;

= Borrowed amount × (1 + rate of interest)^time period

= $2,000,000 × (1 + 0.11)^3

= $2,000,000 × 1.11^3

= $2,000,000 × 1.367631

= $2,735,262

Hence, the amount of payment is $2,735,262