Glen wants to purchase new equipment for his landscaping business. He wants to arrange a loan that he will not have to repay for 24 months. The loan he has negotiated has an annual rate of 5.35% compounded quarterly. He only wants to pay back a maximum of $18500 when the loan matures in 24 months.
a. What is the maximum he could borrow?

Question

mxddi3 · Answer

@jhonyy9

mxddi3 · Answer

@Shadow

Shadow · Answer

$$A = P (1 + \frac{ r }{ n })^{nt}$$

A = amount accumulated over n years
P = the principal amount (the initial amount you borrow)
r = the annual rate of interest as a decimal
n = the number of times interest is compounded each year
t = the number of years you borrow the $$$

Shadow · Answer

Compounding quarterly means 4x a year.