Simple Interest

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A $4000 loan made at 11.75% is to b repaid in three equal payments, due 30, 90, and 150 days, respectively, after the date of the loan. Detemine the size of the payments.

Let the amount of each payment be represented by x.

P1=
______x__________=0.9904349x
1 + 0.01175(30/365)


P2=
_______x__________=0.9718432x
1 + 0.01175(90/365)


P3=
_______x__________=0.9539366x
1 + 0.01175(150/365)


$4000= P1 + P2 + P3

= 0.9904349x + 0.9718432x
+ 0.9539366x

=2.916215x

x= ___$4000___
2.916215

x= $1371.64

Therefore, each payment should be $1371.64.

My question is how do i get the answer in P1=0.9904349x, P2=0.9718432x, and
P3=0.9539366x. Just show me for one of them then i can understand how to do it for the rest. Thanks.

  • Simple Interest -

    To directly answer your question, the values are:
    x/(1 + 0.1175(30/365))
    =x*(1/[1+0.1175(30/365)]
    =x*(1/1.009657534246579)
    =0.99043484159826x

    You could not reproduce the answer because the expression was incorrect. The 0.1175 had been transcribed as 0.01175.

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