Question

choose the correct answers for interest in dollars and the proceeds for the following problem.

sam sounds received a $320.00 discount loan to purchase a stereo. the loan was offered at 16% for 90 days. find the interest and the proceeds for the following problem.

the interest is $
the proceeds are $

Explanation:

Identify given values

We have a discount loan with:

• Principal \(P = \$320.00\)
• Interest rate \(r = 16\% = 0.16\) per year
• Time \(t = 90\) days

Calculate the discount interest

For short-term business loans, the ordinary interest (Banker's interest) method using a 360-day year is standard:

$$ I = P \cdot r \cdot \frac{t}{360} $$

$$ I = 320.00 \cdot 0.16 \cdot \frac{90}{360} $$

$$ I = 320.00 \cdot 0.16 \cdot 0.25 = 12.80 $$

Calculate the proceeds

The proceeds of a discount loan are the principal minus the interest:

$$ \text{Proceeds} = P - I $$

$$ \text{Proceeds} = 320.00 - 12.80 = 307.20 $$

Answer:

Choose the correct answers for Interest in dollars and the proceeds for the following problem.

Sam Sounds received a \$320.00 discount loan to purchase a stereo. The loan was offered at 16% for 90 days. Find the interest and the proceeds for the following problem.

The Interest is $ <blank>12.80</blank>.

The proceeds are $ <blank>307.20</blank>.