Question

The simple interest due on a 60-day loan of $7100 is $87.57. Find the maturity value of the loan.

Answer 1

The maturity value is the total amount that must be repayed after the given time. Thus,

maturity value = interest + principal

From the information given,

Principal = 7100

Interest = 85.57

Thus,

maturity value = 7100 + 87.57

maturity value = $7187.57