Christina Hercher borrowed $50,000 on a 90 day, eight percent note. Christina paid $3,000 toward the note on day 40. On day 60 she paid an additional $4,000. Using the U.S. Rule, Christina's adjusted balance after the first payment is: (Points : 1)
$1,008.89
$48,008.89
$47,444.44
$44,744.44
None of these
P = Po + Po*r*t.
r = (8%/360)/100% = 0.00022222 = Daily %
rate.
P=50000 + 50000*0.0002222*40=$50,444.44
Bal. = 50444.44-3000 = $47,444.44
None of these! Because I don't lend money, I just lend laughter!
To determine Christina's adjusted balance after the first payment, we can use the U.S. Rule formula:
Adjusted Balance = Principal + (Principal * Interest Rate * Time)
Given:
Principal (amount borrowed) = $50,000
Interest Rate = 8% per year
Time = 40 days
First, let's calculate the interest accrued for the first 40 days:
Interest = Principal * Interest Rate * (Time / 360)
= $50,000 * 0.08 * (40 / 360)
= $444.44
Next, let's calculate the remaining balance after the first payment:
Remaining Balance = Principal + Interest - Payment
= $50,000 + $444.44 - $3,000
= $47,444.44
Therefore, Christina's adjusted balance after the first payment is $47,444.44.
The correct answer is: $47,444.44
To find Christina's adjusted balance after the first payment using the U.S. Rule, we need to calculate the interest on the loan for the first 40 days and subtract it from the initial borrowed amount of $50,000.
First, we calculate the interest for the first 40 days. The formula to calculate the interest on the U.S. Rule is:
Interest = Principal * Rate * Time
Principal = $50,000
Rate = 8% = 0.08 (as a decimal)
Time = 40/365 (since the interest is calculated on a daily basis, we divide the number of days by 365 to get the fraction of a year)
Interest = $50,000 * 0.08 * (40/365)
Interest = $1,095.89 (rounded to two decimal places)
Next, we subtract the interest from the initial borrowed amount:
Adjusted balance after the first payment = $50,000 - $1,095.89
Adjusted balance after the first payment = $48,904.11
Therefore, the correct answer is none of these as none of the given options match the calculated adjusted balance.