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Thread: Need help for math for investment

  1. #1
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    Need help for math for investment

    - Annie receives USD80,000 from a bank after signing a 130-day note for USD92,000. At what simple discount rate is interest in advance computed?

    - Jason receives USD104,000 for discounting a 110-day note 40 days before it matures. Find the rate of the note in simple interest if its value is USD68,000 and the bank discount is USD5,200.



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  2. #2
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    Re: Need help for math for investment

    Quote Originally Posted by herapme123 View Post
    - Annie receives USD80,000 from a bank after signing a 130-day note for USD92,000. At what simple discount rate is interest in advance computed?
    Have you not made any attempt at this yourself? Annie got $80,000 but has to pay back $92,000 so she is paying 92,000- 80,000= $12,000 interest. She has the money for 130 days= 130/360= 0.36 year.

    - Jason receives USD104,000 for discounting a 110-day note 40 days before it matures. Find the rate of the note in simple interest if its value is USD68,000 and the bank discount is USD5,200.
    Jason received 104,000- 68,000= $36,000 for, essentially, loaning $68,000 for 40/365= .11 yr.


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