Answer:
The principal amount on which the bank gives loan is $ 239.0117
Step-by-step explanation:
Given as :
The rate of interest = 8.5 % at simple interest
The time period of the loan = 5 years
The interest amount = $ 101.58
Let The principal amount = $ p
From simple interest method
Simple interest = [tex]\dfrac{\textrm principal\times \textrm rate\times \textrm time}{100}[/tex]
Or, $ 101.58 = [tex]\dfrac{\textrm $ p\times \textrm 8.5\times \textrm 5}{100}[/tex]
Or, $ 101.58 × 100 = 42.5 × p
Or, $ 10158 = 42.5 × p
∴ p =[tex]\frac{10158}{42.5}[/tex]
I.e p = $ 239.0117
So, The principal amount = p = $ 239.0117
Hence The principal amount on which the bank gives loan is $ 239.0117 Answer
