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April 21, 2014

Homework Help: Simple Interest & Maturity Value

Posted by Angie on Thursday, February 16, 2012 at 1:28am.

On September 7, Jennifer Rick went to Park Bank to borrow $3,200 at 11 2/3% interest. Jennifer plans to repay the loan on January 5. Assume the loan is on ordinary interest (ordinary interest uses 360 days a year).
Solving for:
1. interest Jennifer will owe on January 5
2. the total amount Jennifer must repay at maturity.
My calculations have given me answers of
1. $124.44 interest ($3200)(11 2/3%)(120/360)
2. $3,324.44 maturity value on Jan 5th

The website the problems are on indicates they are incorrect answers. So I am stuck.
I appreciate any insight I can get.
Thank you!

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