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2 years ago

8

Calculate the interest and total amount due at the end of the loan for both simple and compound interest. Loan YearsRate(a)$1,00

025%(b)$1,50056%(c)$10,0001010%(d)$25,0001515%(e)$47,7502020%You should have 4 values for your final answer:1. Simple interest total amount duei. Simple interest total interest 2. Compound interest total amount due 3. Compound interest total interest

1 answer:

Crank2 years ago

6 0

Solution :

a). Interest for the simple interest $= 1000 \times 5 \times 2$

= $ 100

Amount due for the simple interest = $ 1000 + $ 100

= $ 1100

Amount due for the compound interest $= 1000 \times (1.05)^2$

= $ 1102.50

Interest for the compound interest = $ 1102.50 - $ 1000

= $ 102.50

b). Interest for the simple interest $= 1500 \times 6 \times 5$

= $ 450

Amount due for the simple interest = $ 1500 + $ 450

= $ 1950

Amount due for the compound interest $= 1500 \times (1.06)^5$

= $ 2007.34

Interest for the compound interest = $ 2007.34 - $ 1500

= $ 507.34

c). Interest for the simple interest $= 1000 \times 10 \times 10$

= $ 100000

Amount due for the simple interest = $ 10000 + $ 10000

= $ 20000

Amount due for the compound interest $= 10000 \times (1.10)^{10}$

= $ 25937.42

Interest for the compound interest = $ 25937.42 - $ 10000

= $ 15937.42

d). Interest for the simple interest $= 25000 \times 15 \times 15$

= $ 56,2500

Amount due for the simple interest = $ 25000 + $ 56,250

= $ 81,250

Amount due for the compound interest $= 25000 \times (1.15)^{15}$

= $ 203,426.54

Interest for the compound interest = $ 203,426.54 - $ 25,000

= $ 178,426.54

e). Interest for the simple interest $= 47,750 \times 20 \times 20$

= $ 191,000

Amount due for the simple interest = $ 47,750 + $ 191,000

= $ 238,750

Amount due for the compound interest $= 47,750 \times (1.20)^{20}$

= $ 1,830,620.40

Interest for the compound interest = $ 1,830,620.40 - $ 47,750

= $ 1,782,870.40

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