Question

the interest paid for borrowing qn amount of money for 3yrs at the rate of 4%is n108 find the amount of the money borrowed

Answer 1

Answer:

$864.94

Step-by-step explanation:

So the amount of money over time can be given with an exponential function y=a(b)^x or more specifically y=a(1+r)^x    where r is the growth rate (interest rate)

So the equation can be written as

$m= P(1.04)^t$    where m represents the amount of money over time, P represents the principle amount, and t represents time in years. Since we're given the amount of interest paid and not the total amount which includes the initial amount borrowed you have to subtract P from the equation. This will give us the equation that we'll use to find the initial amount

$I = P(1.04)^t-P$  where I represents the interest paid.

plug the values into the equation

$108 = P(1.04)^3-P\\108 = P(1.124864) - P\\108 = 0.124864P\\\\864.941 = P$