Final answer:
To calculate the original borrowed amount of Toys Or More which includes 6.4% interest, we utilize the simple interest formula and solve a linear equation.
Step-by-step explanation:
The question asks us to determine the original amount Toys Or More borrowed on December 29, 2017, if they promised to repay $24,400.36 on January 18, 2018, including 6.4% interest. To calculate the principal borrowed (P) we can use the simple interest formula I = Prt, where I is the interest paid, P is the principal amount borrowed, r is the annual interest rate, and t is the time in years. As the loan period is less than a year, we'll need to convert the time to a fraction of a year Let's calculate the interest (I) first: I = Total Repayment - Principal Borrowed I = $24,400.36 - P The time (t) in years, assuming the year has 365 days and the period is from December 29, 2017, to January 18, 2018, is about 20/365 years The annual interest rate (r) is 6.4%, or 0.064 in decimal form. Now using the simple interest formula, we can set up the equation: $24,400.36 - P = P * 0.064 * (20/365) which simplifies to a linear equation that we can solve for P. Upon solving, we find the original amount borrowed by Toys Or More.