Chapter 10.I, Problem 7RE

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8th Edition

Robert Brechner + 1 other

ISBN: 9781305585447

Textbook Problem

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

__________________________________________________________________________

$45,000 13 100 $1,602.74 $1,625.00

__________ _________

To determine

**To calculate:** The comparison between exact interest and the ordinary interest for the loan of

Explanation

**Given Information:**

The loan of

**Formula Used:**

The simple interest formula is *T* is the time period in years.

For exact interest,

For ordinary interest,

**Calculation:**

Consider the data provided as the loan of

Then the Interest can be calculated in the following manner,

The time period for exact interest is,

Sect-10.I P-1TIESect-10.I P-2TIESect-10.I P-3TIESect-10.I P-4TIESect-10.I P-5TIESect-10.I P-6TIESect-10.I P-1RESect-10.I P-2RESect-10.I P-3RESect-10.I P-4RE

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