Question

Scott Peter’s bank granted him a single-payment loan of $3,250 to pay a repair bill. He agreed to repay the loan in 31 days at an exact interest rate of 11.75%. What is the maturity value of the loan?

Answer 1

Exact interest rate means there are 365 days in a year
The formula is
A=p (1+rt)
A=3,250×(1+0.1175×(31÷365))
A=3,282.43

Hope it helps

Answer 2

Answer: The maturity value of the loan will be $6493.32.

Explanation:

Since we have given that

Amount of single payment loan = $3250

Number of days he is agreed to repay the loan = 31 days

Rate of interest = 11.75%

As we know the formula :

`A=P(1+rt)`

where P denotes "Principal"

r denotes "Rate of interest "

t denotes "Time"

So, our equation becomes

`A=3250(1+0.1175* (31)/(365))\\\\A=3250(1+0.00998)\\\\A=3250(1.00998)\\\\A=\$3282.43`

So, the maturity value of the loan will be $6493.32.