Lisa took out a loan for $10,500 and was charged simple interest at an annual rate of 8.8%. The total interest she paid on the loan was $462. How long was the loan for, in months? Do not round any intermediate computations. If necessary, refer to the list of financial formulas. months X
Lisa took out a loan for $10,500 and was charged simple interest at an annual rate of 8.8%. The total interest she paid on the loan was $462. How long was the loan for, in months? Do not round any intermediate computations. If necessary, refer to the list of financial formulas. months X
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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![**Problem Statement:**
Lisa took out a loan for $10,500 and was charged simple interest at an annual rate of 8.8%. The total interest she paid on the loan was $462.
**Question:**
How long was the loan for, in months?
*Note: Do not round any intermediate computations. If necessary, refer to the list of financial formulas.*
**Input Field:**
- __ months [ ] [Calculate Button]
Below the question, there are two buttons: "Explanation" and "Check."
**Graph/Diagram Explanation:**
There are no graphs or diagrams in the image.
---
For more detailed calculations or formula reference, you may want to consult financial resources that explain simple interest. Simple interest can be calculated with the formula:
\[ I = P \times r \times t \]
Where:
- \( I \) is the interest
- \( P \) is the principal amount
- \( r \) is the annual interest rate (decimal)
- \( t \) is the time in years
To find the time in months, you can rearrange the formula to solve for \( t \) and convert years to months by multiplying by 12.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F1bf5f2d2-c7f1-48e4-ad28-8902cdd08a04%2Ffe694f50-b797-4fe0-979b-c9b68d6f5b00%2F9y9uvqw_processed.jpeg&w=3840&q=75)
Transcribed Image Text:**Problem Statement:**
Lisa took out a loan for $10,500 and was charged simple interest at an annual rate of 8.8%. The total interest she paid on the loan was $462.
**Question:**
How long was the loan for, in months?
*Note: Do not round any intermediate computations. If necessary, refer to the list of financial formulas.*
**Input Field:**
- __ months [ ] [Calculate Button]
Below the question, there are two buttons: "Explanation" and "Check."
**Graph/Diagram Explanation:**
There are no graphs or diagrams in the image.
---
For more detailed calculations or formula reference, you may want to consult financial resources that explain simple interest. Simple interest can be calculated with the formula:
\[ I = P \times r \times t \]
Where:
- \( I \) is the interest
- \( P \) is the principal amount
- \( r \) is the annual interest rate (decimal)
- \( t \) is the time in years
To find the time in months, you can rearrange the formula to solve for \( t \) and convert years to months by multiplying by 12.
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