Zelda borrowed R5760,00
from a bank for 21 months. For the discount loan she only received R4752,00
. Determine:
(i) the yearly discount rate, d
(ii) the equivalent yearly simple interest rate, i
Give the answers as percentages and round them to two decimal places.
In this we have to calculate present value on based on discount rate.
i
Discounted value = Present value=475200
Borrowed amount =576000
Period = 21 months =1.75 years
r = Annual rate of interest
r=11.62%
This is annual rate of interest.
ii
Discount =576000-475200=$100800
Simple interest rate
Simple interest rate=10%
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