Total interest accrued on a $7,500, 5%, 90-day note is:
A) 93.75
B) 375.00
C) 31.25
D) 125.00

Name: Total interest accrued on a $7,500, 5%, 90-day note is: A) 93.75 B) 375.00 C) 31.25 D) 125.00
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Question

Quizplus · Accepted Answer

The interest on a note can be calculated using the formula: Interest = Principal × Rate × Time. Here, Principal = $7,500, Rate = 5% (or 0.05 as a decimal), and Time = 90 days (or 90/360 because a year is considered 360 days in banking). So, Interest = $7,500 × 0.05 × (90/360) = $93.75.

Total Interest Accrued on a $7,500, 5%, 90-Day Note Is