On January 5, Steven received a $25,000 advance on a revolving line of credit at 3.75% annual rate. On march 5, the annual rate increased to 4.25%. Determine the simple interest to be paid from January 5^th to August 15^th.

A) $626.03
B) $632.03
C) $638.03
D) $644.03
E) $650.03

Question

brianna felder · Accepted Answer

Final Answer : A, Explanation :  The correct answer is A because the simple interest is calculated as follows:Simple interest = Principal x Rate x TimeSimple interest = $25,000 x 3.75% x 60/360 + $25,000 x 4.25% x 150/360Simple interest = $626.03

On January 5, Steven received a $25,000 advance on a revolving line of credit at 3.75% annual rate. On march 5, the annual rate increased to 4.25%. Determine the simple interest to be paid from January 5^th to August 15^th.

A) $626.03
B) $632.03
C) $638.03
D) $644.03
E) $650.03

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Learning Objectives

Related questions

On January 5, Steven received a $25,000 advance on a revolving line of credit at 3.75% annual rate. On march 5, the annual rate increased to 4.25%. Determine the simple interest to be paid from January 5th to August 15th.A) $626.03B) $632.03C) $638.03D) $644.03E) $650.03

Definitions

Learning Objectives

Learning Objectives

Related questions

On January 5, Steven received a $25,000 advance on a revolving line of credit at 3.75% annual rate. On march 5, the annual rate increased to 4.25%. Determine the simple interest to be paid from January 5^th to August 15^th.

A) $626.03
B) $632.03
C) $638.03
D) $644.03
E) $650.03