Exercise data
$ 1500
Interest rate = 0.07%= 0.07/ 100 = 0.0007
a) How much interest will Arielle pay for the statement for the month of May which
has 31 days?
Simple Interest=P×I×N
where:
P=principle
I=daily interest rate
N=number of days between payments
Interest= 1500 x (0.07/100) x 31 = $ 32.55
another way to write
Interest= 1500 x (0.0007) x 31 = $ 32.55
b)What is the balance that she owes?
Balance = P x ( 1 + I*t) where t= time.
Balance = 1500 x (1 + 0.0007*31)
Balance = 1500 x (1 + 0.217)
Balance = 1500 x (1 .217)
Balance = 1532.55
another way to solve
Balance = P + Interest
Balance = 1500 + 32.55
Balance = 1532.55