Faye borrowed $9600 at 8% per anum compound interest. (a) Calculate the interest on the loan for the first year.
At the end of the last year, she repaid $4368.
(b) How much did she still owe at the beginning of the year?
(c)Calculate the interest on the remaining balance for the second year.

(a) $768

Step-by-step explanation:

Faye borrowed $9600 at 8% interest compounded per annum.

Solution for question (a):

Amount accumulated is given by;

A = P(1 +

Where A is the amount, P is the pricipal, r is the rate, n is the number of times in a year, and t is the number of years.

So the amount after one year was;

A = 9600(1 + = 9600 × 1.08 = 10368

Interest = Amount - Principal = $10368 - $9600 = $768

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step-by-step explanation: