Answer: the interest owed is $21
Step-by-step explanation:
The question is incomplete. The complete question is:
Sari Tagore obtains a $1000 loan to purchase a laser printer. Her interest rate is 7% ordinary interest for 108 days. What is the interest owed?
Solution:
When calculating ordinary interest, we assume that a year has 360 days. We would apply the formula for determining simple interest which is expressed as
I = PRT/100
Where
I represents interest paid on the loan
P represents principal or amount borrowed.
R represents interest rate
T represents duration in years
From the information given,
P = 1000
R = 7%
T = 108 days. Converting to years, it becomes 108/360
Therefore
I = (1000 × 7 × 108/360)/100
I = $21
