My Math Forum Calculating Simple Interest Rate Per Annum

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 March 16th, 2014, 03:42 AM #1 Newbie   Joined: Feb 2013 Posts: 5 Thanks: 1 Calculating Simple Interest Rate Per Annum Question: Seventy days after the issue date, the original owner sold the note to Tiffany for $97,651.13. Calculate the rate of simple interest p.a. used by Tiffany in calculating her purchase price. (The answer should be expressed as a percentage correct to 2 decimal places.) help anyone  March 16th, 2014, 01:06 PM #2 Global Moderator Joined: May 2007 Posts: 6,806 Thanks: 716 Re: Calculating Simple Interest Rate Per Annum You need to tell us the face value of the note.  March 16th, 2014, 09:19 PM #3 Math Team Joined: Oct 2011 From: Ottawa Ontario, Canada Posts: 14,597 Thanks: 1038 Re: Calculating Simple Interest Rate Per Annum I see you got no answer here either: http://ph.answers.yahoo.com/question/in ... 006AAcACO9 As Mathman said, more info required.  March 20th, 2014, 03:40 AM #4 Newbie Joined: Feb 2013 Posts: 5 Thanks: 1 Re: Calculating Simple Interest Rate Per Annum Full Information: A 180?days promissory note (this is similar to a bank bill) will mature for$100,000 plus simple i nterest at 7%p.a. Calculate  the maturity value of the note. (Correct the answe r to 2 decimal places.)   Seventy days after the issue date, the original ow ner sold the note to Tiffany for $97,651.13. Calcu late the rate of simple interest p.a. used by Tiffany in calculating her p urchase price. (The answer should be expressed as a percentage correct to 2 decimal places.)  March 20th, 2014, 08:57 AM #5 Math Team Joined: Oct 2011 From: Ottawa Ontario, Canada Posts: 14,597 Thanks: 1038 Re: Calculating Simple Interest Rate Per Annum Why did you not post in full to start with? Hint: Tiffany is investing$97,651.13 today and will collect $103,500 in 110 days. The$3,500 interest on the note assumes a 360day year.
 March 20th, 2014, 08:04 PM #6 Newbie   Joined: Feb 2013 Posts: 5 Thanks: 1 Re: Calculating Simple Interest Rate Per Annum is the Answer 5.33%? Formula is r=((S/P)-1)/T Where S future Value--->97651.13 P is current value---->96663.14 T is Time-->70/365 so r=0.0533. Another way, if i am assuming 180 day period, getting the same answer T=70/180 r=((97651.13/96663.14)-1)/(70/180) r=0.026 Now multiplying =r*(365/180) =(0.026)*(365/180) =0.0527 =0.053=5.3%
 March 20th, 2014, 09:14 PM #7 Math Team   Joined: Oct 2011 From: Ottawa Ontario, Canada Posts: 14,597 Thanks: 1038 Re: Calculating Simple Interest Rate Per Annum I can't tell what you're doing; why present and futire values? She will collect 103,500 after 110 days (180-70), so earning interest of 5,849 (103,500-97,651) over 110 days. Find the equivalent interest over 360 (or 365) days, then calculate the rate required to achieve that.

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