Question

A sum of $11,000 is borrowed and 160 days an annual simple interest rate of 9% calculate the maturity value in dollars used 360 days in one year

Answer 1

Given:

A sum of $11,000 is borrowed for 160 days

And the annual simple interest rate = 9%

So, P = 11000, r = 9% = 0.09

Time = t = 160/360 = 4/9

The interest will be calculated as follows:

`I=P\cdot r\cdot t=11000\cdot0.09\cdot(4)/(9)=440`

So, the maturity value will be as follows:

`=P+I=11000+440=11,440`

So, the answer will be:

The maturity value = $11,440