Asked by Brittni Parrish on Jun 15, 2024
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Cortez Sheet Metal borrowed $12,250 to make its quarterly payroll tax payment to the government. The loan was for 45 days at a 8% exact simple interest rate. Compute the amount of interest that it paid for this loan. (Use a 365-day year.)
Exact Simple Interest
Interest calculated precisely based on the principal amount, rate of interest, and time, without considering the effects of compounding.
365-Day Year
A term referring to the normal count of days in a calendar year, not including leap years which have 366 days.
Quarterly Payroll
The total amount of wages paid by a business to its employees in a three-month period.
- Outline the discrepancies between ordinary (360-day year) and exact (365-day year) interest computations.
- Invoke mathematical capabilities to find both standard and exact interest rates.
- Learn to precisely round numbers to the nearest cent in the context of finance calculations.
Verified Answer
Learning Objectives
- Outline the discrepancies between ordinary (360-day year) and exact (365-day year) interest computations.
- Invoke mathematical capabilities to find both standard and exact interest rates.
- Learn to precisely round numbers to the nearest cent in the context of finance calculations.
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