(a) Explanation Given Information: Principal invested is $ 5 , 000 , rate of interest is 8 % and maturity value is $ 10 , 000 . Formula used: The formula to compute maturity value is, M V = P + I Where, MV is the maturity value, P is the principal amount and I is the amount of interest. Rearranging the above formula to compute amount of interest, I = M V − P The formula to compute the time period of loan is, T = I P R Where, P is the principal amount, I is the amount of interest, R is the rate of interest, T is the time period. Calculation: Consider that the maturity value is $ 10 , 000 and principal invested is $ 5 , 000 . Compute the amount of interest, I = M V − P Substitute $ 10 , 000 for maturity value and $ 5 , 000 for principal invested in the formula I = M (b) To determine To calculate: The time period of loan where principal invested is $ 5 , 000 , rate of interest is 10 % and maturity value is $ 10 , 000 .

Contemporary Mathematics for Business & Consumers - With LMS CengageNOW

8th Edition

ISBN: 9781337125468

Author: Brechner

Publisher: Cengage

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Chapter 10.II, Problem 37RE

(a)

To determine

To calculate: The time period of loan where principal invested is $5,000, rate of interest is 8% and maturity value is $10,000.

(b)

To determine

To calculate: The time period of loan where principal invested is $5,000, rate of interest is 10% and maturity value is $10,000.

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Chapter 10.II, Problem 36RE

Chapter 10.III, Problem 11TIE

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The time period of loan where principal invested is $ 5 , 000 , rate of interest is 8 % and maturity value is $ 10 , 000 .

Solution Summary: The author calculates the time period of loan, where principal invested is 5,000, rate of interest is 8% and maturity value is 10,000.