Asked by Emily Faith on Jun 09, 2024
Verified
The main refrigerator at Parkside Grille Restaurant had a serious malfunction. Laura Casper, the owner/chef, found a very nice used replacement refrigerator, but she needed $4,500 additional cash immediately. She took out a 75-day loan at 7.5% exact simple interest. Compute the total, interest, and principal that Laura must pay for this loan. (Use a 365-day year.)
Exact Simple Interest
Interest calculation method using a 365-day year that does not account for the effect of compounding.
365-Day Year
A method used for calculating interest based upon a calendar year, counting all 365 days (or 366 in a leap year), typically used for more precise financial calculations.
- Attain knowledge to calculate the exact simple interest for loans within a 365-day year context.
- Figure out the total repayment value (base sum plus interest) for brief-length financings.
Verified Answer
PG
Patrina GayleJun 15, 2024
Final Answer :
$4,500 × 0.075 × 75/365 = $69.35; $4,500 + $69.35 = $4,569.35
Learning Objectives
- Attain knowledge to calculate the exact simple interest for loans within a 365-day year context.
- Figure out the total repayment value (base sum plus interest) for brief-length financings.