Lisa borrowed money at a 6% simple interest rate. IF she paid back a total of $8000 at the end of 10 years, how much did she originally borrow? Write your answer appropriately as dollars and cents.

Question

History

Frodo

25 December, 04:04

Lisa borrowed money at a 6% simple interest rate. IF she paid back a total of $8000 at the end of 10 years, how much did she originally borrow? Write your answer appropriately as dollars and cents.

+1

Answers (1)

Know the Answer?

Dayana Goodman · Answer 1

The original amount borrowed = $4,467.158

Explanation:

We need to determine the present value

Present value = FV / ((1+r) ^n)

FV = $8,000

r = 6%

n = 10

Inserting the figures in the formula mentioned above:

PV = $8,000 / (1+0.06) ^10

PV = $4,467.158