What is the maturity value of a $800 loan for two years at a simple interest rate of 7%?

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Answer 1 · 2017-08-08T01:57:59

#$912#

The formula for calculating Simple Interest is:

#SI=(PxxTxxR)/100#, where #SI=#Simple Interest, #P=#Principal amount, #T=#Time in years, and #R=#Rate of interest in percent.

#SI=(800xx2xx7)/100#

#SI=(8cancel00xx2xx7)/(1cancel00)#

#SI=8xx2xx7#

#SI=112#

The maturity value is the sum of the principal and the simple interest:

#800+112=912#