On April 12, Michelle borrowed $5,000 from her credit union at 9% for 80 days. The credit union

uses the ordinary interest method.
a. What is the amount of interest on the loan? $90
b. What is the maturity value of the loan?$5090
c. What is the maturity date of the loan?july 1

I got them all wrong...the answers i got are above

REINY your answers are incorrect as well the correct answers are:

A) 5000x0.09x80/360=100

B) 5000(1+0.09x80/360)=5100

C) 30-12=18
80-18=62
62-31=31
31-30=1
answer is July 1

A) Interest=100

(5,000x0.09x80)=36,000
36,000/360 days= 100

B) Formula MV=P+I
MV= 5,000+100
MV= 5,100
MV- Maturity Value
P- Price
I- Interest

Well, it seems like the answers are not quite right. Let's try again with a little bit of humor!

a. What is the amount of interest on the loan? Well, let's see. Michelle borrowed $5,000, right? And the interest rate is 9%? So, we'll have to take $5,000 and multiply it by 9%. That means the interest on the loan is... a whole lot of numbers and calculations! Just kidding, it's $450.

b. What is the maturity value of the loan? Ah, the maturity value, the fancy way of saying "how much does Michelle owe in total?" Well, she borrowed $5,000, right? And we just found out that the interest is $450. So, we add those two numbers together and get... wait for it... $5,450! Voila!

c. What is the maturity date of the loan? Ah, the maturity date, the day when the loan becomes all grown up and ready to face the world. So, Michelle borrowed the money on April 12, and the loan is for 80 days. Now, let's do some counting... one Mississippi, two Mississippi... And we land on July 1! That's the day the loan reaches its maturity and becomes a mature, responsible loan.

Remember, laughter is the best interest calculation method!

To calculate the correct answers, follow these steps:

a. To find the amount of interest on the loan, you need to use the formula: Interest = Principal × Rate × Time. In this case, the principal is $5,000, the rate is 9% (or 0.09 as a decimal), and the time is 80 days (which should be converted to years).
So, the calculation would be: Interest = $5,000 × 0.09 × (80/365) ≈ $98.63.

Therefore, the correct answer for the amount of interest on the loan is $98.63, not $90.

b. The maturity value of the loan is the total amount that Michelle will have to repay, which includes the principal and the interest. So, to find the maturity value, you simply need to add the principal ($5,000) to the interest ($98.63) that we calculated in part a.
The calculation would be: Maturity Value = Principal + Interest = $5,000 + $98.63 ≈ $5,098.63.

Therefore, the correct answer for the maturity value of the loan is $5,098.63, not $5,090.

c. To determine the maturity date of the loan, you need to count 80 days from the starting date, April 12.
April has 30 days, so you subtract 30 from 80, leaving 50 days. Then, counting from April 13, you add the remaining 50 days.

Since June has 30 days and 20 days are left, you subtract 20 from 50, which leaves 30 days. Now, you count from June 1 to find the maturity date.

Taking into account all the calculations, the maturity date of the loan is July 1, not June 1.

Therefore, the correct answer for the maturity date of the loan is July 1, not June 1.

I hope this explanation helps clarify the correct answers for you.

How are you getting your answers ???

a) interest = 5000(.09)(80/365) = 98.63

b) value = 5000 + 98.63 = $5098.63

c) look at a calendar, count 80 days starting April 13 as one, april 14 as 2 , etc