The principal P is borrowed at a simple interest rate r for a period of time t. Find the loan's future value A, or the total amount due at time t. Round answer to the nearest cent.

P = $6,000, r = 6%, t = 2 years

Question

The principal P is borrowed at a simple interest rate r for a period of time t. Find the loan's future value A, or the total amount due at time t. Round answer to the nearest cent.

P = $6,000, r = 6%, t = 2 years

campbell_st · Answer

The simple interest formula is 

$$I = P \times \frac{r}{100} \times n$$

this will give the amount of interest owed. 

the total to be repaid, of future value A = Principal (P) + Interest(I)

hope it helps

anonymous · Answer

that doesn't help to much haha can you go through the steps with me?

campbell_st · Answer

ok... the interest on the loan is 

$$I = 6000 \times \frac{6}{100} \times 2$$

calculate that

anonymous · Answer

so 720?

campbell_st · Answer

ok... so thats the interest you have to pay on the loan. 


you have to repay the amount borrowed ($6000) plus the interest ($720)

so the future value A = 6000 + 720

anonymous · Answer

can you help me with this one too? 

Calculate the monthly payments for an add-on interest loan of $3,500, with an annual interest rate of 19% and a term of 1.5 years. Round to the nearest cent.

campbell_st · Answer

Will it use the simple interest formula..?

anonymous · Answer

I'm not sure.. :(