Explanation Given Information: Face value is $ 5 , 000 , discount rate is 14.7 % , date of note is 16 April and maturity date is 9 July. Formula used: Steps for determining number of days of a loan are: Step1. Calculate the number of days left in the month in which loan was taken by subtracting the loan date from the number of days in the month. Step2. Determine the number of days for next succeeding months. Step3. Calculate the number of days that are left in the last month till the due date. Step4. Add all the days calculated. The formula to compute the amount of bank discount is, Bank Discount = Face value × Discount Rate × Time The formula to calculate amount of proceeds is, Proceeds = Face value − bank discount Calculation: Calculate the number of days that are left in the month when the loan was taken by subtracting the loan date from the number of days in the month as: Number of days left = Total days in that month − Loan Date = 30 − 16 = 14 Determine the number of days for next succeeding months, that is, May and June. 31 + 30 = 61 Calculate the number of days that are left in the last month till the due date. Total number days in July till due date are 9 . Total number of days of loan can be computed by adding all the computed days as follows: Total number of days of loan = 14 + 61 + 9 = 84 Hence, the total number of days of the loan is 84 . Now, compute the amount of bank discount, Simplify the discount rate as, 14.7 % = 14

Contemporary Mathematics For Business & Consumers, Loose-leaf Version

8th Edition

ISBN: 9781305867185

Author: Robert Brechner, Geroge Bergeman

Publisher: South-Western College Pub

See similar textbooks

Concept explainers

Unitary Method

The word “unitary” comes from the word “unit”, which means a single and complete entity. In this method, we find the value of a unit product from the given number of products, and then we solve for the other number of products.

Speed, Time, and Distance

Imagine you and 3 of your friends are planning to go to the playground at 6 in the evening. Your house is one mile away from the playground and one of your friends named Jim must start at 5 pm to reach the playground by walk. The other two friends are 3 …

Profit and Loss

The amount earned or lost on the sale of one or more items is referred to as the profit or loss on that item.

Units and Measurements

Measurements and comparisons are the foundation of science and engineering. We, therefore, need rules that tell us how things are measured and compared. For these measurements and comparisons, we perform certain experiments, and we will need the experime…

Videos

Question

Chapter 10.III, Problem 7RE

To determine

To calculate: The time duration of the simple discount notes, amount of bank discount and proceeds by using the ordinary interest method where face value is $5,000, discount rate is 14.7%, date of note is 16 April and maturity date is 9 July.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Chapter 10.III, Problem 6RE

Chapter 10.III, Problem 8RE

Students have asked these similar questions

the answer is C, could you show me how to do it

y of 45 home- televisions u find that 010020 le own one, ee, and 1 owns y histogram of 4 Suppose that you have a loaded die. You roll it several times and record the outcomes, which are shown in the following figure. Histogram for Loaded Die 444% 34.00 48% 6% 2% Frequency 20 20 15 155 10 5- ம 0 1 2 3 4 Outcome 5 6 a. Make a relative frequency histogram of these results. b. You can make a relative frequency histo- gram from a frequency histogram; can you go the other direction?

7. [-/1 Points] DETAILS MY NOTES SESSCALCET2 6.1.505.XP. Evaluate the integral. (Use C for the constant of integration.) 21z³e² dz | 21 Need Help? Read It SUBMIT ANSWER 8. [-/1 Points] DETAILS MY NOTES SESSCALCET2 6.1.020. Evaluate the integral. 36 In y dy ₤36 25 Need Help? Read It SUBMIT ANSWER 9. [-/1 Points] DETAILS MY NOTES SESSCALCET2 6.1.009. Evaluate the integral. (Use C for the constant of integration.) In(7x In(7x + 1) dx

Chapter 10 Solutions

Contemporary Mathematics For Business & Consumers, Loose-leaf Version

Ch. 10.I - Find the amount of interest on each of the...Ch. 10.I - Joe Hale goes to a credit union and borrows...Ch. 10.I - Prob. 3TIE Ch. 10.I - Prob. 4TIE Ch. 10.I - a. A loan was made on April 4 and had a due date...Ch. 10.I - a. What is the maturity date of a loan taken out...Ch. 10.I - Prob. 1RE Ch. 10.I - Prob. 2RE Ch. 10.I - Prob. 3RE Ch. 10.I - Prob. 4RE

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, subject and related others by exploring similar questions and additional content below.

The time duration of the simple discount notes, amount of bank discount and proceeds by using the ordinary interest method where face value is $ 5 , 000 , discount rate is 14.7 % , date of note is 16 April and maturity date is 9 July.

Solution Summary: The author calculates the time duration of the simple discount notes, amount of bank discount, and proceeds by using the ordinary interest method.

Concept explainers

Videos

To calculate: The time duration of the simple discount notes, amount of bank discount and proceeds by using the ordinary interest method where face value is $5,000, discount rate is 14.7%, date of note is 16 April and maturity date is 9 July.

Want to see the full answer?

Chapter 10 Solutions