Problem

34. Fernand borrowed $\$ 180.00$ for 8 months at an interest rate of $18 \%$. How much must he repay at the end of the 8 months?

Solution

Step 1 :Given that Fernand borrowed $180.00 for 8 months at an interest rate of 18% per annum, we are to find the total amount he must repay at the end of the 8 months.

Step 2 :The interest on a loan is calculated by multiplying the principal (the amount borrowed) by the interest rate and the time the money is borrowed for.

Step 3 :In this case, the time is 8 months, but the interest rate is given per year, so we need to convert the time to years by dividing by 12. This gives us \(\frac{8}{12} = 0.6666666666666666\) years.

Step 4 :We can now calculate the interest by multiplying the principal, the interest rate, and the time in years. This gives us \(180.0 \times 0.18 \times 0.6666666666666666 = 21.599999999999998\).

Step 5 :The total amount to be repaid is the sum of the principal and the interest. This gives us \(180.0 + 21.599999999999998 = 201.6\).

Step 6 :Therefore, Fernand must repay \(\boxed{\$201.60}\) at the end of the 8 months.

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