SOLUTION: A $4000 loan, taken now, with a simple interest rate of 8%, per year, will require a total repayment of $4640. When will the loan mature?

Question 590789: A $4000 loan, taken now, with a simple interest rate of 8%, per year, will require a total repayment of $4640. When will the loan mature?
Answer by Theo(13342) (Show Source): You can put this solution on YOUR website!
interest rate is 8% per year = .08 per year
total repayment is 4640 on a loan of 4000.
total interest to be paid is 640.
total interest each year is calculated at .08 * 4000 = 320 per year.
640 / 320 = 2 years when the total amount on the loan equals 4640 which is when the loan matures.
paying the loan before 2 years is up requires less interest to be paid.
paying the loan after 2 years is up requires more interest to be paid.
total due is 4640 in exactly 2 yeara.

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