If you borrow 75 000 for two and a half years at an interest rate of 9.5% what is the maturity value of the loan 

To calculate the maturity value of the loan, we can use the formula for simple interest:

\[
\text{Maturity Value} = P + I
\]

where:
- $ P $ is the principal amount,
- $ I $ is the interest, calculated as $ I = P \times r \times t $,
- $ r $ is the interest rate (as a decimal),
- $ t $ is the time in years.

Given:
- $ P = 75,000 $,
- $ r = 9.5\% = 0.095 $,
- $ t = 2.5 $ years.

First, calculate the interest:

\[
I = 75,000 \times 0.095 \times 2.5 = 17,812.50
\]

Now, add the interest to the principal to get the maturity value:

\[
\text{Maturity Value} = 75,000 + 17,812.50 = 92,812.50
\]

Thus, the maturity value of the loan is **$92,812.50**.

Would you like further details or have any questions?

Here are 5 related questions for deeper exploration:
1. How does the maturity value change with a different interest rate?
2. What if the interest is compounded annually instead of using simple interest?
3. How would the maturity value differ if the loan term were 3 years?
4. What is the difference between nominal and effective interest rates?
5. How would monthly repayments affect the loan's final cost?

**Tip:** Always convert the interest rate to a decimal before calculating interest.

If you borrow 75,000 for two and a half years at an interest rate of 9.5%, what is the maturity value of the loan?

Find out how to calculate the maturity value of a loan of 75,000 at an interest rate of 9.5% over 2.5 years using the simple interest formula. Understand the key concepts of interest calculation and loan maturity, suitable for students in Grades 9-12.

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