Joyce took out a loan for $21,900 at 12 percent on March 18, 2007, which will be due on January 9, 2008. Using ordinary interest, Joyce will pay back on Jan. 9 a total amount:

Question

anonymous · Answer

My problem is figuring out the time amount. Do I just count the days in each month, or is there a formula for this?

shane_b · Answer

You could do that if you're taking a test or something...but for homework I'd just use a date calculator...like this one: http://www.timeanddate.com/date/duration.html

shane_b · Answer

It looks like it's 297 days.

anonymous · Answer

oh I just found out according to the text, "exact interest" is 365 days and "ordinary interest" is the 360 days.

shane_b · Answer

Ahh...well that explains that.  I've never used 360 days for any interest stuff.

anonymous · Answer

i know, OMG that calculator is awesome! thanks!

shane_b · Answer

Anyway, if it's 297 days (298 if you count the last day) then you get:
$$I=Prt=$21,900(0.12)(297/360)=$2,168.10$$...just add that to her principal to see how much she paid for the loan.

anonymous · Answer

right and the question asks what the total she will pay back is in which I got $24,068.10

shane_b · Answer

Yeps

anonymous · Answer

awesome thanks!

shane_b · Answer

np