Problema Solution
Compute the principal for the following loan. (Round to the nearest cent, 2 places after decimal.)
Principal
Rate (%)
Time
Interest
10½ %
10 months
$5,900
Answer provided by our tutors
interest = principal * rate * time
we have time = 10/12 years
10 1/2% is represented as a decimal by 0.105
let 'p' represent principal, then:
5900 = p*0.105*(10/12.)
solving for 'p' we have p=67428.5714
the principal value of the loan is approximately $67,428.57