Question

A sum of 20,000 pesos in invested from April 9 to December 3 of the same year at 15% simple interest. Find the interest earned using the four method.

Answer 1

Data:

Principal: 20,000 pesos

Rate: 15%

Time: from April 9 to December 3

Time in years:

$\begin{gathered} 7\text{months}\cdot\frac{1\text{year}}{12\text{monts}}=\frac{7}{12}\text{years} \\ \\ 24\text{days}\cdot\frac{1\text{year}}{365\text{days}}=\frac{24}{365}\text{years} \\ \\ \\ \text{Total:} \\ \frac{7}{12}+\frac{24}{365}=\frac{2555+288}{4380}\approx0.65years \end{gathered}$

Using the time in years and the interest rate in decimal you get the next;

$\begin{gathered} I=P\cdot R\cdot T \\ \\ I=20,000\cdot0.15\cdot0.65 \\ \\ I=1,950 \end{gathered}$Then, the interest earned in that time is 1,950 pesos