Marina Guzmon’s bank granted her a single-payment loan of $3,250 to pay a repair bill. She agreed to repay the loan in 31 days at an ordinary interest rate of 11.75%. What is the maturity value of the loan?

Question

wolf1728 · Answer

The 11.75% rate would be annual rate correct?

naudiapie · Answer

it says 31 days so wouldn't it be monthly

wolf1728 · Answer

But I imagine the rate would be an annual rate

naudiapie · Answer

i don't know

naudiapie · Answer

" repay the loan in 31 days at an ordinary interest rate of 11.75%." an interest rate of 11.75 every 31 days would be monthly

naudiapie · Answer

I HAVE NO IDEA

wolf1728 · Answer

I think the additional rate for interest would be 
(11.75%/12) = 0.009791666667
That would be the interest rate paid on the loan.

naudiapie · Answer

not really, is there an equation

wolf1728 · Answer

Loan = 3,250.00 

PLUS 3,250 * 0.009791666667 = 31.8229166667 (loan interest) You know what to do now?

wolf1728 · Answer

I guess the equation would be 
Total Loan repayment =
Amount Borrowed
PLUS Interest

wolf1728 · Answer

Can you round 31.8229166667  to dollars and cents?

wolf1728 · Answer

Can you round it?  (Should be easy)

naudiapie · Answer

31.82?

wolf1728 · Answer

Right - that is the loan interest.  Now what do you do?

naudiapie · Answer

add it?

wolf1728 · Answer

That's correct.

naudiapie · Answer

3282.82?

naudiapie · Answer

idk

naudiapie · Answer

I have dyscalculia and this is hurting my head physically

wolf1728 · Answer

I think you are too high by 1 dollar - 
Should be $3,281.82
and that's it !!

naudiapie · Answer

It says incorrect, there is no multiple choice, just a box where you put the answer

wolf1728 · Answer

Oh geez, maybe they want it rounded  to nearest dollar - or something.
Maybe somone else will join this discussion or maybe you could just ask it again.

naudiapie · Answer

whatever i guess, this is why i hate math, get it wrong and you get tossed to the next person

wolf1728 · Answer

Maybe they don't want the comma input?  So, input 3250.82 ?
No I'll stick with you but I think I have run out of ideas.

naudiapie · Answer

the comma is needed, it has to look like this "$9999" or if theres cents "$9999.99"

naudiapie · Answer

sorry "$9,999"* etc

naudiapie · Answer

Let's just start over with the question

naudiapie · Answer

Marina Guzmon’s bank granted her a single-payment loan of $3,250 to pay a repair bill. She agreed to repay the loan in 31 days at an ordinary interest rate of 11.75%. What is the maturity value of the loan?

wolf1728 · Answer

I mean 3281.82 !!! 
Then input  $3,281.82

naudiapie · Answer

It didn't work

wolf1728 · Answer

Okay, I'm asking a friend to join us.

wolf1728 · Answer

Hmmmmmmm, I think I made a mistake.
The interest is 381.875
Which rounds to 381.88
3250 + 381.88 = 3,631.88

Try that.

naudiapie · Answer

still says wrong, even rounding

wolf1728 · Answer

Okay MAYBE try 3,631.87

naudiapie · Answer

still wrong

naudiapie · Answer

how are you finding the interest

naudiapie · Answer

are you doing 11.75*31

wolf1728 · Answer

11.75% interest means you have to multiply Loan Amount by (.1175/12)
which is 0.0097916667
No - I guess I didn't calculate it wrong.

wolf1728 · Answer

Now you know why I'd like someone else to look at this.

naudiapie · Answer

why by 12  though ?

naudiapie · Answer

wouldn't it be .1175/31

phi · Answer

do you have notes where they explain a similar problem ?

naudiapie · Answer

not really

wolf1728 · Answer

Gee, it seems you had 2 other people here - but no help.  sheesh :-(

naudiapie · Answer

Interest = Principal × Rate × Time
 Ordinary Interest = Principal × Rate × Time
360
 Exact Interest = Principal × Rate × Time
365
 Maturity Value = Principal + Interest

wolf1728 · Answer

Well phi is back

wolf1728 · Answer

Hello Directrix!!! :-)

wolf1728 · Answer

And thank you for dropping by Directrix

phi · Answer

what is the 360 ?  number of days?  it sounds like you should use a rate of
0.1175/360 ?

directrix · Answer

Banker's Year ----------- Definition A year that consists of 12 months, each of them having 30 days each, and amounting to a 360-day year. This system makes it easier for financial institutions to calculate interest. Read more: http://www.investorwords.com/15206/bankers_year.html#ixzz48CjsKm4H

naudiapie · Answer

i got it guys

phi · Answer

what was the answer ?

naudiapie · Answer

3250.00 * .1175* 31 / 360  =32.88

phi · Answer

ok, good to know

naudiapie · Answer

32.88 + 3250 = $3,282.88

naudiapie · Answer

says it's correct

naudiapie · Answer

all you need was this Interest = Principal × Rate × Time
 Ordinary Interest = Principal × Rate × Time
360
 Exact Interest = Principal × Rate × Time
365
 Maturity Value = Principal + Interest

wolf1728 · Answer

Okay - well someone finally got the answer. :-)

directrix · Answer

Are these the answer options?

a.
$3,012.21

c.
$3,282.88

b.
$3,221.09

d.
$3,454.99

naudiapie · Answer

there was no multiple choice , just a box that you have to fill in

naudiapie · Answer

I ended up getting $3,282.88 and it was correct

directrix · Answer

How did you get $3,282.88 so that we can be of better help next time?  @Naudiapie

naudiapie · Answer

Interest = Principal × Rate × Time
 Ordinary Interest = Principal × Rate × Time
360
 Exact Interest = Principal × Rate × Time
365
 Maturity Value = Principal + Interest

naudiapie · Answer

the question asks for ordinary rate, so you choose the 2nd equation

naudiapie · Answer

3250*.1175*31 / 360 = 32.88

naudiapie · Answer

it asks for the maturity value so you use the last equation which would be 
 Maturity Value = Principal + Interest

3,250.00 +32.88 = 3,282.88

directrix · Answer

Got it. Thanks.

naudiapie · Answer

np