Concept explainers
The simple interest and the maturity value for the amount $7,800 at
Answer to Problem 1ECP
The simple interest and the maturity value for the amount $7,800 at
Explanation of Solution
Given:
The principal amount (P) is $7,800.
The rate of interest (R) is
Formula used:
Simple interest:
Simple interest formula is
Maturity value:
The maturity value is calculated using
Calculation:
Compute the simple interest as follows.
Convert the rate of interest in to decimal as below.
Convert the 18 months into years.
Now substitute
Thus, the simple interest for the amount $7,800 at
Compute the maturity value as follows.
Substitute
Thus, maturity value for the amount $7,800 at the
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