Jnaet took out a loan of $50,000 from Bank of America at 8 percent on March 9, 2006 which is due on July 8, 2006. Using exact interest, the amount of Janet's interest is?
$1304.11
The formula for this is I = PRT
I = Interest
P = Principal ($50,000)
R = Rate (8% -> .08)
T = Time in years (111/365)
I = (50000)(.08)(111/365)
I = $1216.438 -> $1216.44 (rounded)
To find Janet's interest, we need to calculate the interest for the period from March 9, 2006, to July 8, 2006, using the exact interest method.
First, we need to determine the time (in days) between the two dates. Let's break it down step by step:
1. Find the number of days in March, April, May, June, and July:
- March: 31 days
- April: 30 days
- May: 31 days
- June: 30 days
- July: 8 days
2. Calculate the total number of days:
Total days = 31 (March) + 30 (April) + 31 (May) + 30 (June) + 8 (July)
= 130 days
Now that we have the time, we can calculate the interest using the formula:
Interest = Principal (loan amount) * Rate * Time
Principal = $50,000
Rate = 8% as a decimal (0.08)
Time = 130 days / 365 days (assuming a year has 365 days)
Let's calculate the interest:
Interest = $50,000 * 0.08 * (130 / 365)
= $50,000 * 0.08 * 0.356164
≈ $1,143.84
Therefore, Janet's interest using the exact interest method is approximately $1,143.84.