Use the exact interest method (365 days) and the ordinary interest method (360 days) to compare the amount of interest for the following loans.
Principal Rate(%) Time(days) Exact Interest Ordinary Interest
$50,490

To calculate: The amount of interest accrued by using the ordinary method and the exact method on a principle amount of
Given Information:
The principle amount of
Formula used:
The formula to compute the simple interest is,
Where, P is the principal amount, I is the amount of interest, R is the rate of interest and T is the timeperiod.
The ordinary interest for the given loan is;
The exact interest for the given loan is;
Calculation:
As given, the principle amount of
For ordinary interest for the given loan is;
Thus,
For exact interest for the given loan is;
Thus,
The amount of interest accrued from the issue of principal at a rate of interest of
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