A demand loan for $8945.17 with interest at 9.8% compounded semi-annually is repaid after 6 years, 10 months. What is the amount of interest paid? The amount of interest is $ (Round the final answer to the nearest cent as needed. Round all intermediate values to six decimal places as needed.)

A demand loan for $8945.17 with interest at 9.8% compounded semi-annually is repaid after 6 years, 10 months. What is the amount of interest paid? The amount of interest is $ (Round the final answer to the nearest cent as needed. Round all intermediate values to six decimal places as needed.)

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter19: Lease And Intermediate-term Financing

Section: Chapter Questions

Problem 18P

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Concept explainers

Effective Interest Rate

The term interest rate can be defined as the amount that is charged by the lender as a percentage on the principal amount. Interest rate which is charged annually is known as annual percentage rate.

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A2)

A demand loan for $8945.17 with interest at 9.8% compounded semi-annually is repaid after 6 years,
10 months. What is the amount of interest paid?
The amount of interest is $
(Round the final answer to the nearest cent as needed. Round all intermediate values to six decimal
places as needed.)

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