145k views
5 votes
What is the total paymentrequired to pay off a promissorynote issued for $500.00 at 8%ordinary interest and a 90-dayterm?

What is the total paymentrequired to pay off a promissorynote issued for $500.00 at-example-1

1 Answer

0 votes

Solution:

Given in the question, we have the amount to be


=\text{ \$}500

The interest rate given is


=8\%=(8)/(100)=0.08

The time is given below as


\begin{gathered} t=90days \\ t=(90)/(365)=0.25 \end{gathered}

Step 1:

We will calculate the simple interest


\begin{gathered} I=(PRT)/(100) \\ I=(500*8*0.25)/(100) \\ I=\text{ \$}10.00 \end{gathered}

Step 2:

We will calculate the total repayment using the formula below


\begin{gathered} T.P=A+I \\ T.P=\text{ \$}500+\text{ \$}10 \\ T.P=\text{ \$}510.00 \end{gathered}

Hence,

The final answer is


\Rightarrow\text{ \$}510.00

OPTION C is the right answer

User Warren MacEvoy
by
8.1k points
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