your business requests a 3 - month loan for $500,000. what will be the interest paid at the end of the term…

your business requests a 3 - month loan for $500,000. what will be the interest paid at the end of the term if the business risk percentage is assessed at 2.2% and libor is at 1.8%?\ninterest paid = $?\nround to the nearest hundredth.

your business requests a 3 - month loan for $500,000. what will be the interest paid at the end of the term if the business risk percentage is assessed at 2.2% and libor is at 1.8%?\ninterest paid = $?\nround to the nearest hundredth.

Answer

Answer:

$50000.00

Explanation:

Step1: Calculate total interest rate

$2.2%+ 1.8%=4%$

Step2: Convert time to years

3 months $=\frac{3}{12}=0.25$ years

Step3: Calculate interest

$I = P\times r\times t$, where $P = 500000$, $r=0.04$, $t = 0.25$. So $I=500000\times0.04\times0.25 = 50000$