Question

Suppose that you borrow $2000.00 from a friend and promise to pay back $3260.00 in 3 years. What simple interest rate will you pay? The simple interest rate is % (Round to the nearest tenth as needed.) The principal P is borrowed at a simple interest rate r for a period of time L. Find the loan's future value A, or the total amount due at time L. P=$7000,r=8.5%,t=8 months The loan's future value is $ (Do not round until the final answer. Then round to the nearest cent as needed.) The principal P is borrowed at a simple interest fale r for a period of time t. Find the simple interest owed for the use of the money. Assume there are 360 days in a year, P=$7000,r=8.5%,t=6 months (Round to the nearest cent as needed.)

Answer 1

below :)

Explanation:

To calculate the simple interest rate, we can use the formula:

Simple Interest = Principal (P) x Interest Rate (r) x Time (t)

For the first scenario:

Principal (P) = $2000.00

Future Value (A) = $3260.00

Time (t) = 3 years

We need to find the interest rate (r).

Simple Interest = A - P

Simple Interest = $3260.00 - $2000.00

Simple Interest = $1260.00

Simple Interest = P x r x t

$1260.00 = $2000.00 x r x 3

r = $1260.00 / ($2000.00 x 3)

r = 0.21

The simple interest rate is 0.21, which is equivalent to 21% (rounded to the nearest tenth).

For the second scenario:

Principal (P) = $7000.00

Interest Rate (r) = 8.5% or 0.085

Time (t) = 8 months

We need to find the future value (A).

A = P + (P x r x t)

A = $7000.00 + ($7000.00 x 0.085 x (8/12))

A = $7000.00 + ($7000.00 x 0.085 x 2/3)

A = $7000.00 + ($7000.00 x 0.056666...)

A ≈ $7000.00 + $396.67

A ≈ $7396.67

The loan's future value is approximately $7396.67 (rounded to the nearest cent).

For the third scenario:

Principal (P) = $7000.00

Interest Rate (r) = 8.5% or 0.085

Time (t) = 6 months

We need to find the simple interest owed for the use of the money.

Simple Interest = P x r x t

Simple Interest = $7000.00 x 0.085 x (6/12)

Simple Interest = $7000.00 x 0.085 x 0.5

Simple Interest = $297.50

The simple interest owed for the use of the money is $297.50 (rounded to the nearest cent).