The Mathematics of Money
2 Learning Objectives LO 1 Understand the concept of the time value of money, and recognize the reasoning behind the payment of ...
Copyright © 2008, The McGraw-Hill Companies, Inc. 1.1 Simple Interest and the Time Value of Money 3 Despite this, though, you pr ...
4 Chapter 1 Simple Interest Definition 1.1.4 A debtor is someone who owes someone else money. A creditor is someone to whom mone ...
Copyright © 2008, The McGraw-Hill Companies, Inc. 1.1 Simple Interest and the Time Value of Money 5 precisely what you would hav ...
6 Chapter 1 Simple Interest Back to Percents So now let’s return to the problem proposed a while back of determining 11.35% inte ...
1.1 Simple Interest and the Time Value of Money 7 The Impact of Time Let’s return again to Tom and Larry. Suppose that Larry ret ...
8 Chapter 1 Simple Interest meantime, though, we will do a bit of sweeping under the rug and simply not worry about the reason f ...
Copyright © 2008, The McGraw-Hill Companies, Inc. you probably don’t think of your deposit as a loan. In reality, though, it act ...
10 Chapter 1 Simple Interest B. Adding Interest to Determine Repayment Amounts Tony loaned Josh $2,000. Josh agreed to pay Tony ...
Copyright © 2008, The McGraw-Hill Companies, Inc. Terri has borrowed $8,200 for 1 year at a simple interest rate of 11.5% per a ...
12 Chapter 1 Simple Interest Larissa has opened a CD at Canandaigua Federal Bank by depositing $27,392.04. The term of the CD i ...
Copyright © 2008, The McGraw-Hill Companies, Inc. c. Since Tom and Jerry both had the same amount of money, the same amount of t ...
14 Chapter 1 Simple Interest I ($5,000)(.09)(0.5) I $225 So Sarai will pay back $5,000 + $225 $5,225. So as we’ve just see ...
Copyright © 2008, The McGraw-Hill Companies, Inc. be smaller than the denominator (the bottom). Fractions whose numerators are l ...
16 Chapter 1 Simple Interest Example 1.2.5 Calculate the simple interest due on a 120-day loan of $1,000 at 8.6% simple interest ...
Because these different methods do give different results, it is important to be clear on which method is being used in any give ...
18 Chapter 1 Simple Interest How much interest would you have to pay for a 30-month loan of $1,735.53 if the simple interest ra ...
Copyright © 2008, The McGraw-Hill Companies, Inc. Exercises 1.2 19 D. Grab Bag For exercises where the term is given in days, us ...
20 Chapter 1 Simple Interest a loan for the cost of the job for 1 year at 10% simple interest. How much interest would the store ...
Copyright © 2008, The McGraw-Hill Companies, Inc. 1.3 Determining Principal, Interest Rates, and Time So far, we have developed ...
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