A $4,000 loan is to be made over 5 years with 11% interest. Determine how much w
ID: 1132127 • Letter: A
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A $4,000 loan is to be made over 5 years with 11% interest. Determine how much will be required to pay off the loan plus interest if:
please need the answer asap
Question 8 A $4,000 loan is to be made over 5 years with 11% interest. Determine how much will be required to pay off the loan plus interest if: Click here to access the TVM Factor Table Calculator simple interest is used.$ Round entry to the nearest dollar. Tolerance is +4. compound interest is used. $ Round entry to the nearest dollar. Tolerance is +4.Explanation / Answer
Given principal=$4000
Rate of intrest=11%
Time=5 years
SIMPLE INTEREST=PTR÷100
=($4000×5×11)÷100
=$2200
TOTALAMOUNT=PRINCIPAL+INTEREST
=4000+2200=$6200
COMPOUND INTEREST=P[(1+R/100)^n-1]
=4000[(1+11/100)^5-1]
=4000[(1+0.11)^5-1]
=4000[1.6850-1]
=2740
Total amount=principal+ compound interest
=4000+2740
=$6740
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