blue ridge construction take out a loan with a fixed annual effective interest rate of 13.9%. Two months after taking out the loan...

[eilidhm]

blue ridge construction take out a loan with a fixed annual effective interest rate of 13.9%. Two months after taking out the loan, they borrow a further £100,000. After eight months, they owe £652,045.28. What was their initial loan amount? Give your answer to the nearest whole pound.

 

[stapel]

blue ridge construction take out a loan with a fixed annual effective interest rate of 13.9%. Two months after taking out the loan, they borrow a further £100,000. After eight months, they owe £652,045.28. What was their initial loan amount? Give your answer to the nearest whole pound.

What are your thoughts? What formulas or methods have they given you to use? What have you tried? How far have you gotten? ("Read Before Posting")

Please be complete. Thank you!

 

[khansaheb]

blue ridge construction take out a loan with a fixed annual effective interest rate of 13.9%. Two months after taking out the loan, they borrow a further £100,000. After eight months, they owe £652,045.28. What was their initial loan amount? Give your answer to the nearest whole pound.

Please define
annual effective interest rate
as defined in your class-notes.

 

[jonah2.0]

Beer induced reaction follows.

blue ridge construction take out a loan with a fixed annual effective interest rate of 13.9%. Two months after taking out the loan, they borrow a further £100,000. After eight months, they owe £652,045.28. What was their initial loan amount? Give your answer to the nearest whole pound.

Compound interest equation of value.
What have you done so far?

 

[khansaheb]

blue ridge construction take out a loan with a fixed annual effective interest rate of 13.9%. Two months after taking out the loan, they borrow a further £100,000. After eight months, they owe £652,045.28. What was their initial loan amount? Give your answer to the nearest whole pound.

( 1 + r)¹² = 1.139 .................... what is 'r'