document.write( "<A HREF=/cgi-bin/jump-to-question.mpl?question=1134098>Question 1134098</A>: <I><SPAN STYLE=\"word-break: break-all;\"> ou borrow $9000 to help pay your college expenses. You agree to repay the loan at the end of 7 years at 8% interest, compounded quarterly. (Round your answers to two decimal places.)<BR>\n" );
document.write( "(a) What is the maturity value of the loan?<BR>\n" );
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document.write( "(b) How much interest are you paying on the loan?<BR>\n" );
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document.write( "</I><HR><TABLE width=100%><TR><TD><B><A HREF=http://www.algebra.com/>Algebra.Com's</A> Answer #751632 by </B><A HREF=/tutors/aboutme.mpl?userid=Theo><B>Theo(13342)</B></A><img src=\"/images/stars/stars-13.gif\" alt=\"\" >&nbsp;<A HREF=/tutors/aboutme.mpl?userid=Theo><IMG SRC=http://www.algebra.com/images/aboutme-small.gif BORDER=0 alt=\"About Me\" VALIGN=MIDDLE></A>&nbsp;<IMG SRC=http://www.algebra.com/cgi-bin/show-face.mpl?user=Theo><BR>You can <A HREF=\"/cgi-bin/embed-solution.mpl?show=1&solution=751632\">put this solution on YOUR website!</A><BR><SPAN STYLE=\"word-break: break-all;\"> loan is 9,000.<BR>\n" );
document.write( "loan to be paid off at the end of 7 yers at 8% interest per year compounded quarterly.\r<BR>\n" );
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document.write( "formula is f = p * (1 + r) ^ n\r<BR>\n" );
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document.write( "f is the future value<BR>\n" );
document.write( "p is the present value<BR>\n" );
document.write( "r is the interest rate per time period<BR>\n" );
document.write( "n is the number of time periods.\r<BR>\n" );
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document.write( "time period is quarters.<BR>\n" );
document.write( "there are 4 quarters per year.\r<BR>\n" );
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document.write( "interest rate per quarter = 8% per year / 100 = .08 per year / 4 = .02 per quarter.\r<BR>\n" );
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document.write( "number of quarters = 7 years * 4 = 28 quarters.\r<BR>\n" );
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document.write( "since p = 9,000, formula becomes f = 9,000 * (1 + .02) ^ 28.\r<BR>\n" );
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document.write( "solve for f to get f = 15,669.21786 = 15,669.22 rounded to two decimal places.\r<BR>\n" );
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document.write( "that's the maturity value of the loan.\r<BR>\n" );
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document.write( "the interest paid is f - p = 15,669.21786 minus 9,000 = 6,669.21786 = 6,669.22 rounded to two decimal places. </SPAN>\n" );
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