Question

Choose the correct answer for the amount of interest earned in the following simple interest problem. A deposit of $4,000 at 6.5% for 270 days

Answer 1

The formula is
I=prt
I interest earned?
P principle 4000
R interest rate 0.065
T time 270/360days
I=4,000×0.065×(270÷360)
I=195

Note that the interest is ordinary not exact. Ordinary interest assumes that there are 30 days in every month or in other word 360 days a year.

Hope it helps!