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What is the maturity value given the following:$10,800 at 8% for 8 months

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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
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