Question

An amount of R4 317,26 was borrowed on 5 May at a simple interest rate of 15% per year. The loan will be worth R4 500 on

1.     16 August.

2.     12 August.

3.     21 August.

4.     9 October.

5.     none of the above.

Answer 1

simple interest rate$,S=P(1+rt)$

$t=5may$ till 16 Aug

date value =228-125=103days

$t=103/365$

$S=p(1+rt)=4317,26(1+15/100\times 103/365)=R4500$

Therefore, the loan will be worth R4 500 on 16 August.