Question

Mr. Davis borrowed $600 for 60 days at 9% annual interest. However he was able to repay the loan in 30 days. How much interest was he able to save by doing this?

Answer 1

Thus he was able to save 4.438 dollars by paying 30 days before due.

Explanation:

given that Mr. Davis borrowed $600 for 60 days at 9% annual interest.

Thus interest payable for 60 days =
`(600*60*9)/(365*100) \\=8.876`

Because he paid fully after 30 days his interest would have been only for 60 days

or half of interest for 60 days

So savings of interest = 50% of 8.876

=4.438 dollars

Thus he was able to save 4.438 dollars by paying 30 days before due.