Question

Principal $1200Interest rate 6%Date borrowed May 15thDate repaid Aug 17thExact time ?Interest ?Maturity value ?

Answer 1

Given:

`\begin{gathered} \text{ Principal}(p)=\text{\$}1200 \\ \text{ Interest rate}(r)=6\% \end{gathered}`

The date of borrowed is May 15th and the date of repayment is August 17th.

Required:

We have to find the exact time, interest, and maturity value.

Step-by-step explanation:

The exact time between 15th May to 17th August is

`t=94\text{ days.}`

Therefore the time given is

`=(94)/(365)\text{ years.}`

We know that the formula to find the interest is

`\text{ Interest}(I)=\frac{principal* time* interest\text{ rate}}{100}`

`\Rightarrow I=(p* t* r)/(100)`

Therefore, the interest is

`\begin{gathered} I=(1200*(94)/(365)*6)/(100) \\ \\ I=(1200*94*6)/(100*365) \end{gathered}`
`\begin{gathered} =(12*94*6)/(365) \\ \\ =\text{ \$}18.54 \end{gathered}`

Therefore, the maturity value is

`\begin{gathered} =1200+18.54 \\ =\text{ \$}1218.54 \end{gathered}`

Final answer:

Hence the final answer is

`\begin{gathered} \text{ exact time}=94\text{ days} \\ \text{ Interest}=\text{\$}18.54 \\ \text{ Maturity value}=\text{\$}1218.54 \end{gathered}`