Mathematics: Susan duke borrowed $20,000 for four years to purchase a car. the simple interest loan has a rate of 8.2% per year. what is the maturity value of the loan?

Susan duke borrowed $20,000 for four years to

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07.09.2022

D. It will increase by 1%.

Step-by-step explanation:

Given

$u_1 = 5\%$ --- initial rate

$u_2 = 3\%$ --- final rate

Required

The effect on the GDP

To calculate this, we make use of:

$\frac{\triangle Y}{Y} = u_1 - 2\triangle u$

This gives:

$\frac{\triangle Y}{Y} = 5\% - 2(5\% - 3\%)$

$\frac{\triangle Y}{Y} = 5\% - 2(2\%)$

$\frac{\triangle Y}{Y} = 5\% - 4\%$

$\frac{\triangle Y}{Y} = 1\%$

This implies that the GDP will increase by 1%

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