The formula below tells us how to obtain the maturity value on a simple discount loan if we are given the proceeds, the discount rate, and the term. If a loan's annual simple discount rate is 7.56%, how many years would it take for the debt to double? (This is called the doubling time of a loan). Round your answer to the nearest tenth of a year. Hint: divide both sides of the equation by P. If M is twice as much as P, what should the fraction on the left-hand side equal?

The formula below tells us how to obtain the maturity value on a simple discount loan if we are given the proceeds, the discount rate, and the term. If a loan's annual simple discount rate is 7.56%, how many years would it take for the debt to double? (This is called the doubling time of a loan). Round your answer to the nearest tenth of a year. Hint: divide both sides of the equation by P. If M is twice as much as P, what should the fraction on the left-hand side equal?

Corporate Fin Focused Approach

5th Edition

ISBN:9781285660516

Author:EHRHARDT

Publisher:EHRHARDT

Chapter4: Time Value Of Money

Section4.17: Amortized Loans

Problem 1ST

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