Question

The bank discount of an $18,000 non interest bearing, simple discount, 8% 90 day note is?

Answer 1

Answer- Amount of discount the bank will be proving is = $360

Solution-

We know the formula for simple interest, i = Prt

Where i = interest, P = capital, r = rate of interest, t = time period

Substituting the given values,

(Time is the fraction of a year that is considered to have 360 days)

$i = \frac{(18,0000)(08)(90)}{360} = 360$

⇒ i = $360