A businessman borrowed an amount of money from his friend, at a 5% interest rate.
They agreed the payment would be in two times: $11025 on the next month, and $11025 on the month next to it.
When the first payment day came, he haven't got all the money, but only $8000.
His friend agreed in receiving the $8000 and the missing amount on the other month, still at 5% interest.
What's the amount he'll receive in the end of the second month?
The answer is $14201.25
Could you please do that step by step? I'd like to know the whole money lent, the yield, the answer.
My own calculations must be wrong somewhere
http://www.flickr.com/photos/80147355@N0…
They agreed the payment would be in two times: $11025 on the next month, and $11025 on the month next to it.
When the first payment day came, he haven't got all the money, but only $8000.
His friend agreed in receiving the $8000 and the missing amount on the other month, still at 5% interest.
What's the amount he'll receive in the end of the second month?
The answer is $14201.25
Could you please do that step by step? I'd like to know the whole money lent, the yield, the answer.
My own calculations must be wrong somewhere
http://www.flickr.com/photos/80147355@N0…
-
11025 - 8000 = 3025
3025 * 1.05 = 3176.25
3176.25 + 11025 = 14201.25
Now what score did you get on your test that you now need answers to?
EDIT: Looks like you charged interest to the next months 11025 bill.
3025 * 1.05 = 3176.25
3176.25 + 11025 = 14201.25
Now what score did you get on your test that you now need answers to?
EDIT: Looks like you charged interest to the next months 11025 bill.