Question 1158239: A man
uses a loan program for small businesses to obtain a loan to help expand his
vending machine business. The man
borrows $28 comma 000
for 2
years with a simple interest rate of 1.2
%.
Determine the amount of money the man
must repay after 2
years.
Answer by Theo(13342)   (Show Source):
You can put this solution on YOUR website! simple interest formula (not compound interest formula) is used here, as much as i know.
the formula is:
f = p * (1 + r * n).
f is the future value
p is the present value
r is the interest rate per time period
n is the number of time periods
in this problem, the formula becomes:
f = 28,000 * (1 + .012 * 2)
time periods are in years.
r = 1.2% / 100 = .012 per year
n = 2 years
p = 28,000
solve for f to get:
f = 28,672
that's what must be repaid after 2 years.
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