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Unformatted text preview: annual interest rate on Loan A is equivalent to the annual discount rate on Loan B. If Loan A is 2000, the amount of interest on that Katy will pay on Loan A is 662. Calculate the amount of discount that Katy will pay on Loan B is if the amount of Loan B is 1000. (Note: Under discount, the amount of the loan is the amount that must be repaid at the end of the loan, not the amount of cash received at the start of the loan.) 42. Book Problem 1.9, Number 7 43. Kevin invests 100 in a bank account earning a simple interest rate of 10%. James invests 100 in a bank account which earns an annual effective discount rate of d. At the end of 10 years, Kevin and James have the same amount of money in their accounts. Calculate d. Answers: 38. a. 7786.88 b. 2213.12 c. 8.69565% 39. 30,693.44 40. 2934.82 41. 248.69 42. i = 5.31137%; X = 2934.48 43. 6.6967%...
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- Spring '08