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Math Help - Discounts and Simple Interest Rates.

  1. #1
    Ife
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    Discounts and Simple Interest Rates.

    Is this question complete??

    A cash discount is given if a bill is 40 days in advance of its due date. If the bill is for $5,000.00,

    a. What is the highest SI rate at which you can afford to borrow money if you want to take advantage of this discount?

    b. If you can borrow money at a 20% SI rate, how much money can you save by paying the bill for $5,000 forty days in advance?

    I am thinking here that this question is missing the amount of the discount in order to be calculated. Am I right?? If not, how do I go about this?? I am totally lost...
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    Quote Originally Posted by Ife View Post
    Is this question complete??
    A cash discount is given if a bill is 40 days in advance of its due date. If the bill is for $5,000.00,
    Not complete: how much is the discount?
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  3. #3
    Ife
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    well that's all the question gives.. can we take it to be 'x'?? if so, how do we calculate?
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    NOTHING can be done without the discount amount or percentage.
    Check with your teacher.
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  5. #5
    Ife
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    ok so if the savings were like a figure of $100, what would be the calculation from there??
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  6. #6
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    Quote Originally Posted by Ife View Post
    ok so if the savings were like a figure of $100, what would be the calculation from there??
    i/365 * 40 * 5000 = 100 ; i will be the annual rate
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