Question

Compute the amount of interest for $568.00 at 9.31% p.a from July 19, 2006, to October 17, 2006.

a) The interest earned is $12.83.
b) The interest earned is $10.57.
c) The interest earned is $14.92.
d) The interest earned is $11.76.

Answer 1

To compute the amount of interest for $568.00 at 9.31% p.a from July 19, 2006, to October 17, 2006, we can use the formula: Interest = Principal × Rate × Time. Plugging in the values, the interest earned is $12.83 (a).

Step-by-step explanation:

To compute the amount of interest, we first need to calculate the number of days between July 19, 2006, and October 17, 2006. This comes out to be 90 days. We can then use the formula:

Interest = Principal × Rate × Time

where Principal = $568.00, Rate = 9.31% p.a, and Time = 90/365 (as the interest rate is an annual rate).

Using the formula, we get:

Interest = $568.00 × 0.0931 × 90/365 = $12.83

Therefore, the correct answer is a) The interest earned is $12.83.