Asked by Haley Van Roekel on May 01, 2024
Verified
Calculate the maturity value of a loan of $6,875 after 239 days at 18.3%.
A) $7,698.81
B) $7,991.81
C) $6,051.19
D) $8,238.13
E) $8,769.81
Loan
A sum of money that is borrowed, typically from a financial institution, and is expected to be paid back with interest.
- Ascertain the matured value of an investment or debt.
Verified Answer
EM
erica meyersMay 02, 2024
Final Answer :
A
Explanation :
The maturity value of a loan can be calculated using the formula: Maturity Value = Principal + (Principal * Rate * Time), where Time is in years. For this loan, Principal = $6,875, Rate = 18.3% or 0.183 (as a decimal), and Time = 239 days out of 365 days = 239/365 years. Thus, Maturity Value = $6,875 + ($6,875 * 0.183 * 239/365) = $6,875 + $823.81 = $7,698.81.
Learning Objectives
- Ascertain the matured value of an investment or debt.