Question

Terry bergolt bank granted him a single payment loan of $4,400 at an intreats rate of 6% exact interest. The term of the loan is 172 days what is the exact interest? what is the maturity of the loan?

Answer 1

Explanation:

We would apply the formula for determining simple interest which is expressed as

I = PRT/100

Where

P represents the principal

R represents interest rate

T represents time in years

I = interest after t years

From the information given

T =172 days = 172/365 = 0.47 years

P = $4400

R = 6%

Therefore

I = (4400 × 6 × 0.47)/100

I = 12408/100

I = $124.08

The maturity of the loan would be

4400 + 124.08 = $4524.08