The present value of the loan will be = R36,250
<h3>Calculation of the present value</h3>
The principal capital (P) = R25 000
Interest rate for the payment (R)= 7.5%
Time for the payment (T)= 6 years
Therefore simple interest = P×T×R/100
= 25,000×6×7.5/100
= 250×6×7.5
= R11,250
The present value of the loan will be;
= 25,000 + 11,250
= R36,250
Learn more about simple interest here:
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