Question

A man uses a loan program for small businesses to obtain a loan to help expand his vending machine business. The man borrows ​$26 comma 000 for 4 years with a simple interest rate of 1.4​%. Determine the amount of money the man must repay after 4 years.

Answer 1

The ammount due at the end of the loan adds for $27,456

Step-by-step explanation:

If the payment is in full at maturity, the man must pay the principal of 26,000 plus the interest during the period of 4 years.

It is important to notice that the loan is done at simple interest, so the interest does not capitalize.

`Ammount$-due = 26,000 * (1 + 0.014 * 4) = 27,456`