Martha Jones received a $540 discount loan to purchase a new sewing machine. The loan was offered at 12.5% for 90 days. Find the interest in dollars and the proceeds for the following problem.

Question

Vocaloid · Answer

@sillybilly123 @Angle I'm not really sure about some of the technical terminology behind this question, would you mind assisting?

Angle · Answer

For bank interest purposes... or depending on the teacher... interest rates are calculated as 360 days = 1 year.

the provided interest rate (12.5%) is for the 1 year, not 90 days.

so what they want us to calculate is:

540 * 0.125 * (90/360) = ?