What is the amount of the principal plus interest due at maturity on a 1-month (32-day) deposit of USD 50,000,000.00 placed at 0.37%?
A) EUR 50,015,416.67
B) EUR 50,016,219.18
C) EUR 50,016,444.44
D) EUR 50,016,958.33

Question

Quizplus · Accepted Answer

The formula to calculate the amount of the principal plus interest due at maturity is:
Principal + (Principal x Rate x Time)
where Rate is the annual interest rate and Time is the fraction of the year as a decimal.
For a 1-month deposit, Time = 32/365 = 0.0877
Therefore, the calculation is:
USD 50,000,000.00 + (USD 50,000,000.00 x 0.37% x 0.0877) = USD 50,016,444.44
Converting to EUR depends on the exchange rate at the time of conversion.

What Is the Amount of the Principal Plus Interest Due