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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Quizplus · Accepted Answer

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