Question

How much money will you lend in order to get Tshs. 48000/= interests at 6% if you lend it for 6 months?

Answer 1

To find out how much money to lend in order to earn Tshs. 48,000 in interest at a 6% annual interest rate over 6 months, we can use the formula for simple interest:

\[
I = P \times r \times t
\]

where:
- \( I \) is the interest earned (Tshs. 48,000),
- \( P \) is the principal amount (the amount lent),
- \( r \) is the annual interest rate (6% or 0.06),
- \( t \) is the time period in years.

Since 6 months is half a year, we can convert it to years:

\[
t = \frac{6}{12} = 0.5 \text{ years}
\]

Now substituting the known values into the formula:

\[
48000 = P \times 0.06 \times 0.5
\]

Now, solve for \( P \):

\[
P = \frac{48000}{0.06 \times 0.5}
\]

Calculating the denominator:

\[
0.06 \times 0.5 = 0.03
\]

Now substituting that back into the equation for \( P \):

\[
P = \frac{48000}{0.03} = 1600000
\]

Therefore, you would need to lend **Tshs. 1,600,000** to get Tshs. 48,000 in interest at a 6% interest rate over 6 months.