A loan of $10,000 has an annual interest rate of 8%, compounded quarterly. What will be the total due (principal + interest) if no payment is made for 12 months?
(A) $800
(B) $824
(C) $10,800
(D) $10,824
(E) $11,600
[spoiler]OA=D[/spoiler]
Source: Veritas Prep
5-Day Free Trial
5-day free, full-access trial TTP
Available with Beat the GMAT members only code
MORE DETAILS
A loan of $10,000 has an annual interest rate of 8%, compounded quarterly. What will be the total due (principal + inter
This topic has expert replies
-
orthodoxparadox
- Junior | Next Rank: 30 Posts
- Posts: 15
- Joined: Sat May 30, 2020 10:48 pm
Since, annual interest is \(8\%\) , interest per quarter is \(2\%\)
Number of payment periods = Number of quarters in 12 months = 4
Amount due = $$P\ \cdot\ \left(1.02\right)^4\ =\ 10000\ \cdot\ \left(1.0824\right)\ =\ 10824$$ D
Number of payment periods = Number of quarters in 12 months = 4
Amount due = $$P\ \cdot\ \left(1.02\right)^4\ =\ 10000\ \cdot\ \left(1.0824\right)\ =\ 10824$$ D
-
jenniferdehner9
- Newbie | Next Rank: 10 Posts
- Posts: 1
- Joined: Mon Jan 10, 2022 3:53 am
