Answer the following problems: 1. A loan of 10,000 has been issued for 6-years. Compute the amount to be repaid by borrower to the lender if simple interest is charged @ 5% per year.

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
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Answer the following problems with complete solution.
Answer the following problems:
1. A loan of 10,000 has been issued for 6-years. Compute the
amount to be repaid by borrower to the lender if simple
interest is charged @ 5% per year.
2. Suppose 7,000 is divided into two bank accounts. One
account pays 10% simple interest per year and the other
pays 5%. After three years there is a total of 1451.25 in
interest between the two accounts. How much was invested
into each account (rounded to the nearest cent)?
3. John wants to have an interest income of 3,000 a year. How
much must he invest for one year at 8%?
Transcribed Image Text:Answer the following problems: 1. A loan of 10,000 has been issued for 6-years. Compute the amount to be repaid by borrower to the lender if simple interest is charged @ 5% per year. 2. Suppose 7,000 is divided into two bank accounts. One account pays 10% simple interest per year and the other pays 5%. After three years there is a total of 1451.25 in interest between the two accounts. How much was invested into each account (rounded to the nearest cent)? 3. John wants to have an interest income of 3,000 a year. How much must he invest for one year at 8%?
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