Question

John Green received a $580 discount loan to purchase a television. The loan was offered at 16% for 60 days. Find the interest in dollars and the proceeds for the following problem.

The interest is $____.
15.21
14.74
15.47
The proceeds are $____.
554.53
544.53
564.53

Answer 1

Option 3

The interest is $15.47

Proceed = $564.53

Explanation:

Given : John Green received a $580 discount loan to purchase a television. The loan was offered at 16% for 60 days.

To find : The interest in dollars and the proceeds for the following problem?

Solution :

The interest formula,

`I=P* R* T`

Where, P is the principle P=$580

R is the rate R=16%=0.016

T is the time t=60 days

`I=580* 0.16* (60)/(360)`

`I=15.466`

The interest is $15.47.

Therefore, Option 3 is correct.

The proceed is the amount received after interest.

Proceed = Amount - Interest

Proceed = $580- $15.47

Proceed = $564.53

Therefore, Option 3 is correct.

Answer 2

For discounted loans, A = P/(1 - dt), where A is the loan amount, P is the proceeds, d is the discount rate and t is the time
Proceed = A(1 - dt) = 580(1 - 0.16 x 60/365) = $564.53

Interest = A - P = 580 - 564.53 = $15.47