1 Mary owes June 800 and wants to pay her off She decides to

1. Mary owes June $800, and wants to pay her off. She decides to borrow the amount from her bank at a discount rate of 12%. If she borrows the money for 10 months, find the amount of the loan she should ask for so that her proceeds are $800?

Solution

According to problem we will apply formula

Amount = Owes amount/ 1- dt

Here owes amount =800

d= 0.12

t= 10/12

A= 800/(1-012*10/12)

=800/0.90

=888.90 answer