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in six months, you want to have $7000 worth of remodeling done to your home. how much should you invest now, at 9% simple interest, to have enough money for the project? (round up to the nearest cent.)

Respuesta :

I should invest $6,698.56,  at 9% simple interest, to have enough money for the project.

A(t) = P(1+rt) 7000

      = P(1+0.09(1/2)) 7000

      = P(1.045)

   P = 7000/1.045

   P = $6,698.56

  • Calculating the interest on a loan using simple interest is quick and simple. Simple interest is calculated by dividing the principle by the daily interest rate and the number of days between installments.
  • Although some mortgages employ this calculation approach, this type of interest typically relates to auto loans or short-term loans.
  • On a loan with simple interest, the first portion of every payment is applied to the interest for that month, and the remaining amount is applied to the principle. Interest is never accrued because each month's interest is paid in full. Compound interest, on the other hand, adds some of the monthly interest back onto the loan; you pay fresh interest on top of previous interest each month.

Learn more about Simple interest, here

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