A man has a simple discount note for $6,100, at an ordinary bank discount rate of 8.53%, for 40 days. What is theeffective interest rate? Round to the nearest tenth of a percent.The effective interest rate is%.(Round to the nearest tenth of a percent as needed.)C...

an has a simple discount note for $6,100, at an ordinary bank discount rate of 8.53%, for 40 days. ective interest rate? Round to the nearest tenth of a percent. he effective interest rate is%. Round to the nearest tenth of a percent as needed.) www

an has a simple discount note for $6,100, at an ordinary bank discount rate of 8.53%, for 40 days. ective interest rate? Round to the nearest tenth of a percent. he effective interest rate is%. Round to the nearest tenth of a percent as needed.) www

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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A man has a simple discount note for $6,100, at an ordinary bank discount rate of 8.53%, for 60 days. What is the effective interest rate? Round the nearest tenth of a percent. (Use the banker's rule.) The effective interest rate is%. (Round to the nearest tenth of a percent as needed.) ...
The face value of a simple interest note and bank discount note is $8,000each. Assume both notes have 8.75 percent interest rates for 60 days.Calculate the following:a. The amount of interest charged for each.b. The maturity value of the simple interest note.c. The maturity value of the bank discount note.d. The amount the borrower receives for the simple interest note.e. The amount the borrower receives for the bank discount note.
What is the effective interest rate of a simple discount note for $31,200, at an ordinary bank discount rate of 14%, for 30 days? Assume that there are 360 days in a year. The effective interest rate is %. (Round to the nearest tenth as needed.) E 4
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A man makes a simple discount note with a face value of $2,500, a term of 120 days, and an 18% discount rate. Find the discount. (Use the banker's rule.) The discount is $ (Round to the nearest dollar as needed.)
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What is the effective interest rate of a simple discount note for $27,500,at an ordinary bank discount rate of 10%, for 30 days? Assume that there are 360 days in a year. Question content area bottom The effective interest rate is ??? (Round to the nearest tenth as needed.)
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If you sign a discount note for $7,500 at a bank discount rate of 5% for 3 months, what is the effective interest rate? Round to the nearest tenth percent. Step 1 The effective interest rate is the actual interest rate charged on a discounted note and takes into account the fact that the borrower does not receive the full amount of the principal. It is calculated using the bank discount, the proceeds, and time. The bank discount is calculated as follows where the discount rate is given as a decimal and the time will be a fraction whose numerator is the given amount of time in months and denominator is 12 months. bank discount = face value ✕ discount rate ✕ time The rate was given to be 5%. As a decimal, we have . Calculate the bank discount (in $) for the $7,500 promissory note at a discount of 5% for 3 months. bank discount = face value ✕ discount rate ✕ amount of time in months 12 months = $7,500 ✕ ✕ 3 12 = $