1. Jacksonville Technical College received $3,445,553 in state aid on September 15 for the fall academic semester. The vice-president for finance decided to invest $2,000,000 in a 2-month investment that pays 11.5% simple interest. How much interest will the college earn on the investment? (15 points)
2. Barney Casey borrowed $40,000 from his parents for 2 years. He paid them a total of $45,000 at the end of the 2-year term of the simple interest loan. What rate of interest did he pay his parents? (15 points)
3. Sarai Sherman agreed to deposit $4,450 in an account paying 16% simple interest per year for 60 days. If she made the deposit on February 25, determine (a) the date of the end of the term of the investment, and (b) the ordinary interest Sarai will earn. (15 points)
4. Anna Cavanaugh loaned her friend Jason $1,000 for 6 months at 6% simple interest. What is the future value of the loan and how much finance charge will Jason pay? (15 points)
5. Acton can choose from two loan offers: $12,000 at 8% simple interest for 9 months; or a $12,000 9-month discounted loan at 7% discount. Based on the actual interest paid and the true rate on the discounted loan, which of the two loan offers will Acton choose? Explain your answer. (40 points)
Answer For Question #2
X/100 * 40,000= 5,000
X/100 = 5,000/40,000
X/100 = 0.125
X = 0.125*100
X = 12.5%
afraaz the answer of 12.5 is not correct, i had done the same math as you did, however the teacher said that the answer was wrong.
The correct answer is 6.25 percent.
40,000 *6.25*2=5,000
Because interest based on per annum, so interest is 12.5/2=6.25%
1. To find the interest earned on an investment, we can use the formula: Interest = Principal x Rate x Time.
In this case, the principal (amount invested) is $2,000,000, the rate is 11.5% (which we can convert to a decimal by dividing by 100), and the time is 2 months (which we can convert to a fraction of a year by dividing by 12).
So, the formula becomes: Interest = $2,000,000 x (11.5/100) x (2/12).
To find the interest, we can simplify the equation: Interest = $2,000,000 x 0.115 x 0.1667.
Calculating this will give us the interest earned by the college on the investment.
2. To find the rate of interest paid on a loan, we can use the formula: Rate = Total Interest Paid / Principal x Time.
In this case, the principal borrowed is $40,000, the total amount paid back is $45,000, and the time is 2 years.
So, the formula becomes: Rate = $5,000 / $40,000 x 2.
By calculating this, we can determine the rate of interest paid by Barney to his parents.
3. To find the date of the end of the term of an investment, we need to add the specified time (60 days) to the deposit date (February 25th).
The result will give us the end date of the investment.
To find the ordinary interest earned, we can use the formula: Interest = Principal x Rate x Time.
In this case, the principal is $4,450, the rate is 16% (which we can convert to a decimal by dividing by 100), and the time is 60 days (which we can convert to a fraction of a year by dividing by 365).
So, the formula becomes: Interest = $4,450 x (16/100) x (60/365).
Calculating this will give us the ordinary interest earned by Sarai.
4. To find the future value of a loan and the finance charge, we can use the formula: Future Value = Principal + Interest and Finance Charge = Interest.
In this case, the principal loaned is $1,000, the interest rate is 6% (which we can convert to a decimal by dividing by 100), and the time is 6 months (which we can convert to a fraction of a year by dividing by 12).
So, the formula for future value becomes: Future Value = $1,000 + ($1,000 x (6/100) x (6/12)).
And the formula for the finance charge becomes: Finance Charge = $1,000 x (6/100) x (6/12).
By calculating these values, we can determine the future value of the loan and the finance charge paid by Jason.
5. To compare the two loan offers, we need to calculate the total interest paid for each loan.
For the first loan offer, the interest amount can be calculated using the formula: Interest = Principal x Rate x Time. In this case, the principal is $12,000, the rate is 8% (which we can convert to a decimal by dividing by 100), and the time is 9 months (which we can convert to a fraction of a year by dividing by 12).
For the second loan offer, we need to calculate the discount amount first using the formula: Discount Amount = Principal x Discount Rate. In this case, the principal is $12,000, and the discount rate is 7% (which we can convert to a decimal by dividing by 100). Then, to calculate the interest, we subtract the discount amount from the principal and apply the same formula as above.
By comparing the total interest paid for each loan offer, we can determine which one is more advantageous for Acton.
The purpose of this website is to help students with an individual question. not to do a whole assignment for you.
What part of which question don't you understand and need help with?
The simple interest formula used in each one would be
I = PRT, where I is the interest, P is the principal , R is the annual rate written as a decimal, and T is the number of years