Ben Hung signed a 75-day simple interest note for $11,280 with a bank that uses exact interest.

If the rate is 12.3%, find the maturity value.

$11,569.05

$10,994.91

$11,565.09

$10,990.95

6.

Shuler's Teas borrowed $9,805.

The simple interest loan was repaid in 7 months at 8.5%.

Find the amount of the repayment.

$10,291.16

$10,638.43

$10,284.50

$10,504.32

Given:

term: 75-day simple interest note

Principal : $11,280

rate: 12.3%

Interest = Principal * rate * term

Interest = 11,280 *.123 * 75/365

Interest = 285.09

Maturity Value = Principal + Interest

Maturity Value = 11,280 + 285.09

Maturity Value = 11,565.09

The problem stated "exact interest" this means that the 365-day year will be used. The use of 360-day year is called ordinary or banker's interest.

Given:

Amount borrowed: $9,805

term: 7 mos

rate: 8.5%

Interest = Principal * rate * term

Interest = 9,805 * 0.085 * 7/12

Interest = 486.16

Amount repaid = Principal + Interest

Amount repaid = 9,805 + 486.16

Amount repaid = 10,291.16