Question

Linda agreed to lend money to Alex at a rate of 9 percent per year,

contingent he would pay her 300.00 in interest over a four year period. What was the minimum mount Alex could borrow

Answer 1

$731.71

Explanation:

300 over 4 years = 75$ per yr

9% per year so 4 years interest = (1+9%)^4 = 1.41

so effective int rate for 4 years is 41%.

41% * x = 300

x = $731.71