If you want to earn 4% annual simple interest on an investment, how much should you pay for a note that will be worth 13500 in 10 months

Answer 1

The underlying formula that you want to use to solve here is

P = A / (1 + RT)

on this one we have

P = 13500 / (1 + 0.04*10/12)

P = 13500 / (1 + 40/1200) = 13064.52

meaning that you should pay $13,064.52 for the note