SOLUTION: money is borrowed at 12% simple interest. after 1 year, $896 pays off the loan. how much was borrowed originally?

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Question 349959: money is borrowed at 12% simple interest. after 1 year, $896 pays off the loan.
how much was borrowed originally?
Found 2 solutions by rfer, stanbon:
Answer by rfer(16322) About Me  (Show Source):
You can put this solution on YOUR website!
896/1.12=$800

Answer by stanbon(75887) About Me  (Show Source):
You can put this solution on YOUR website!
money is borrowed at 12% simple interest. after 1 year, $896 pays off the loan.
how much was borrowed originally?
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A(t) = P(1+rt)
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896 = P(1+0.12*1)
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896 = P(1.12)
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Principal = 896/1.12
Principal = $800
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Cheers,
Stan H.
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