Question

A loan of $7,000 was approved for 36 weeks. Total amount (principal and interest) was paid as S 7388 charged with an 8% annual rate of interest. What is the value of t time in years?

Answer 1

.7

Explanation:

I'm going to assume that there will just be one final payment at the end. I am also going to discard the fact that the loan was approved for 36 weeks becuase I don't know what to do with that information

I will be using the following formula

`FV=PV(1+i)^n`

Plugging in the numbers we get

7388=7000(1+.08)^n

We we divide by 7,000 and simplify what we can to get

1.0554=1.08^n

We then write the following log

log(1.0554)/log(1.08)=n

Compute this and get n= .7