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Problem 13

# Compute the specified quantity. Round all answers to the nearest month, the nearest cent, or the nearest $$0.001 \%$$, as appropriate. Simple Loans You take out a 6 -month, $$\ 5,000$$ loan at $$8 \%$$ simple interest. How much would you owe at the end of the 6 months?

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## Step 2: Convert the time period to years

To convert the time period from months to years, we simply divide the given period (6 months) by the total number of months in a year (12 months). t (in years) = $$\frac{6}{12}$$ t = 0.5 years

To calculate the simple interest, we will use the formula: Simple Interest (SI) = P * r * t where P, r, and t are defined as mentioned in step 1. SI = $$5,000 * 0.08 * 0.5$$ SI = $$400$$ So, the simple interest after 6 months is $400. ## Step 4: Calculate the total amount owed To find out how much would be owed at the end of the 6 months, we will add the simple interest calculated in step 3 to the principal amount. Total Amount = Principal Amount + Simple Interest Total Amount = $$5,000 + 400$$ Total Amount =$5,400 After 6 months, a total of \$5,400 would be owed.

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