document.write( "Question 284788: \n" ); document.write( "

Algebra.Com's Answer #206589 by toidayma(44) $\"\"$ $\"About$

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Let X ($) the amount of money that Alvin borrowed. After one year, he has to pay both the root X and the interest I. Since (simple) interest rate is 10%, the the interest is I = X*10%. There fore the total amount of money Alvin has to pay is X +I = X + X*10% = 1.1*X = $7194. So X = 7194/1.1 = ($)6540.
\n" ); document.write( "Normally, you can apply this formula for similar problems:
\n" ); document.write( "Vn = Vo*(1 + n*r)
\n" ); document.write( "Whereas:
\n" ); document.write( "-> Vn = the amount of money that pays off the loan after n years.
\n" ); document.write( "-> Vo = the amount of money that first borrowed.
\n" ); document.write( "-> r = the simple interest rate %/year.
\n" ); document.write( "-> n = number of years that the loan must be paid off. \n" ); document.write( "

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