Question

(a)A loan of 12 000 was borrowed from a bank at 14% per annum

Calculate
(i) The interest on the loan at the end of the first year
(ii) The total amount owing at the end of the first year

A repayment of $ 7 800 was made at the start of the second year.

Calculate
(iii) the amount still outstanding at the start of the second year
(iv) the interest on the outstanding amount at the end of the second year

Answer 1

I'll do the first two.

(i)
12,000 * 0.14 = 1,680

(ii)
12,000 + 1,680 = 13,680

I'll be glad to check your answers for the other two.

Answer 2

(iii) 13,680 - 7,800 = 5,880 still outstanding in the second year.

I am not sure how to work out the last one.

Answer 3

(iv)
5,880 * 0,14 =

Answer 4

308

Answer 5

82320

Answer 6

823.2

Answer 7

PxRxT
12000x14/100x1
= 1,680

Answer 8

ii) A= P + I
12000 + 1680
= 13680

Answer 9

¡) 14/100×12000=$1680
¡¡) 12000+1680=13,680
¡¡¡) 13,680-7800=5880
iv) let 100% represent the payment that was made plus the14% interest
100+14=114%
114/100×5800=$6703.2 interest on the end of the second year.
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