The Mathematics of Money

(Darren Dugan) #1

52 Chapter 1 Simple Interest



  1. Suppose that I loan someone $5,000 for 90 days. I will be repaid $5,125 when the loan comes due. Find the simple
    interest rate.

  2. Apercu Industries borrowed $92,350 for 200 days at 15% simple interest. Find the total interest they will pay (a) using
    bankers’ rule and (b) using the exact method.

  3. On March 1, Serge deposited $1,200 in a certifi cate of deposit paying 3.91% simple interest. The certifi cate’s maturity
    date was November 21. Find the value of the certifi cate at maturity.

  4. What date is 890 days from March 29, 2005?

  5. Calvin loaned Erin $8,145 on August 10, 2005. On April 17, 2006, Erin paid off the loan with $8,525.47. Find the
    simple interest rate for this loan.

  6. Axel put $939.39 in a bank account paying 5.35% simple interest. How long will it take before his account has grown
    to $1,000?

  7. Axel put $939.39 in a bank account paying 5.35% simple interest on June 7, 2004. When will his account be worth $1,000?

  8. Find the interest due on a loan of $89,000 for 7 months at 7.38% simple interest.

  9. Express each of the following percent interest rates as decimals:


a. 8%


b. 4^1 / 8 %


c. 15.3%


d. 125%


e. 0.75%



  1. On July 7, a real estate developer offered Danny $275,000 for a vacant building that he owns. The developer states
    that this offer will expire in 35 days. On what date does this offer expire?

  2. How much would you need to have in an investment account in order to generate monthly income of $850, assuming
    a 7.5% simple interest rate?

  3. Convert each of the following percent interest rates to decimals:


a. 4 ¾%


b. 10^7 ⁄ 8 %


c. 13^9 ⁄ 16 %


d. 5^11 ⁄ 32 %

Free download pdf