determine simple interest. The rate is an annual rate with 360 days in a year. p=$2622.52 r= 13.45% t= 287 days

Question

determine simple interest rate is annual 360 days in a year

 

p=2622.52 r=13.45% t= 287

 

Please explain how the answer is obtained for this question

Answer 1

I = P x R x T

 

To start, it would be wise to translate the days to a decimal # because a year would be equal to 1.0 and the given 287 divided by 360 is less than a year, or worth 0.7972

 

Plug in the provided information:

 

I =  2622.52 x .1345  x  .7972   (note that to convert the rate from a percent to a decimal # one has to move the decimal two places left, which is the same as dividing by 100)

 

The answer (simple interest) would be $281.20   or  if rounded to nearest dollar amount $281.00