Lynne needs to borrow $8500 for cosmetic surgery. She obtains a loan from her grandmother for 54 months at a simple interest rate of 5.2%. What is the loans future value?

Answer 1

8500 at 5.2% simple interest for 54 months= 54/12 years = 27/6 =9/2 = 4 1/2 years = 4.5

future value of the loan, to be repaid in a balloon payment lump sum

is

8500(1.052(4.5)= $10,118.80 to be repaid in 4 1/2 years to grandma, but she'll probably let you slide, or even forget she loaned it to you.