66.1k views
1 vote
What is the maturity value given the following:$10,800 at 8% for 8 months

1 Answer

2 votes

The maturity value is the sum of the interest and the principal. The formula for calculating interest is expressed as

I = PRT

where

I is the interest after time t

P is the principal or initial amount

R is the interest rate

T is the time in years

From the information given,

P = 10800

R = 8/100 = 0.08

T = 8 months

We would convert 8 months to years. Recall,

12 months = 1 yr

8 months = 8/12 = 0.67

Thus,

t = 0.67 yr

By substituting these values into the formula, we have

I = 10800 x 0.08 x 0.67

I = 578.88

Thus,

Maturity value = 10800 + 578.88

Maturity value = $11378.88

User Yashu Seth
by
8.5k points

No related questions found

Welcome to QAmmunity.org, where you can ask questions and receive answers from other members of our community.

9.4m questions

12.2m answers

Categories