Question

You find that a small business loan in the amount of 50,000 is the amount you need to purchase the restaurant location. After researching banks to find the best interest rate, you find that banks for small businesses offer the best interest rate of 9% interest that compounds monthly for 7 years.

Answer 1

A = P (1 + r/m) ^ n is the formula.

Answer 2

So you want to find your interest amount, or total loan cost. You want to take what you are given in the word problem which is 50,000, 9% and 7 years length of time. Ok, I see you have that:)

Answer 3

I just dont get it :(

Answer 4

A = 50000 ( 1 + .09/12) 84
Is that right?

Answer 5

Someone smarter than I am will show up here but I am trying to see if we need to do the distributive property, like P x 1 + P X rm first of all

Answer 6

But then I try to solove it and it doesn't pan out...

Answer 7

ok, we'll get it;) don't worry:)

Answer 8

I appreciate this so much... I've been at the for 4 hours!

Answer 9

So you had numbers to replace your variables.

Answer 10

Oh, I so understand. Sec, let me work this on my paper.

Answer 11

Principal would be the loan amount right?

Answer 12

yes, sorry

Answer 13

50000 yes

Answer 14

Ok, we have to find the missing amount so we start with X =

Answer 15

Did you get the formula that i have to use?

Answer 16

Yes, your equation looks fine, I am making it harder on you I'm afraid. I know that we have to do the distribution thing. So 50.000 x 1 + 50,000 X .09/12

Answer 17

there is 84 months in 7 years so we have to multiply that's by .09 to get our interest total? Is that right?

Answer 18

yes that is right.

Answer 19

well actually I think you have to divide .09/12 then multiply by 84

Answer 20

I really don't know... I am soooo confused lol.