A man borrows money from a bank which uses a simple discount rate of 14%. He signs a promissory note promising to pay P500 per month at the end of 4th, 6th, and 7th months respectively. Determine the amount of money that he received from the bank.
Added by Lisa C.
Step 1
The simple discount rate is 14%, which means that the bank charges 14% of the loan amount as interest. Since the loan is repaid in three installments, we need to calculate the interest for each installment separately. For the 4th month installment: The interest Show more…
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