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VCE Stuff => VCE Mathematics => VCE Mathematics/Science/Technology => VCE Subjects + Help => VCE General & Further Mathematics => Topic started by: xtremeownage on June 30, 2011, 09:04:35 pm

Title: Business maths - HELP.
Post by: xtremeownage on June 30, 2011, 09:04:35 pm: Further Maths Essential 3rd edition
Chap 21 C,
Q1 a)
Calculate the flat interest rate per annum on each of the following loans.
a) $2400, to be repaid in 30 monthly installments of $90. The answer is 4% p.a but i dont know how to get to it.

b) $1500, to be repaid in 15 monthly installments of $115. = 12 % p.a, dont know how to work it out again.

How am i suppose to do this? i mean the P value isnt even given, im getting pissed as at Business maths and my school is making me do it, help will be very appreciated.
Title: Re: Business maths - HELP.
Post by: _avO on June 30, 2011, 09:27:07 pm: 1a should be 5%
PV should be what you get at the start

Just use the formula
$i = \frac{1}{t}(\frac{FV}{PV}-1)$
Title: Re: Business maths - HELP.
Post by: xtremeownage on June 30, 2011, 09:28:51 pm: FV and PV values would be ?, sorry kinda dont know what they represent and that formula isnt even in my book -.- sigh.
Title: Re: Business maths - HELP.
Post by: _avO on June 30, 2011, 09:31:10 pm: FV = future value (what you pay in the end in total including interest)
PV = present value (what the loan amounted to at the beginning)

eg.
a) FV = 90 x $30 = $2700
PV = 2400
Title: Re: Business maths - HELP.
Post by: xtremeownage on June 30, 2011, 09:31:54 pm: thanks.
Title: Re: Business maths - HELP.
Post by: MJRomeo81 on August 21, 2011, 06:21:56 pm: Or use this formula:

flat interest rate = (100 X Interest) / (P X time in years)

So for your first question, it would be (100X300) / (2400 X 2.5) = 5%