Question

Determine how much you would receive in return for a 8 month, $500 loan to a friend if you charged the 3% annual interest.

Answer 1

Answer:

I think it is $15

Step-by-step explanation:

Taking the test now.

Answer 2

Answer:

You would receive $510.08 in return.

Step-by-step explanation:

In order to find the answer, you can use the formula to calculate the future value:

FV=PV*(1+i)^n

FV=future value

PV= present value= 500

i= interest rate=0.03/12=0.0025 per month

n= number of periods of time= 8

Now, you can replace the values in the formula:

FV=500*(1+0.0025)^8

FV=500*(1.0025)^8

FV=510.08

According to this, the answer is that you would receive $510.08 in return.