You deposit $200,000 on April 29,2012 in a fund earning simple interest at r = 7%.Using the banker's rule (ordinary interest),how much do you have on September 29,2012?
A)$205,950.00
B)$205,911.11
C)$205,868.49
D)$205,833.33

Question

Quizplus · Accepted Answer

The banker's rule is used to calculate the interest on a deposit for a period that is less than a year. The formula for simple interest is I = Prt, where I is the interest, P is the principal, r is the interest rate, and t is the time. In this case, the principal is $200,000, the interest rate is 7%, and the time is 153 days (from April 29 to September 29). Plugging these values into the formula, we get I = 200000 * 0.07 * 153 / 360 = $5,950.00. Adding this to the principal, we get $200,000 + $5,950.00 = $205,950.00.

You Deposit $200,000 on April 29,2012 in a Fund Earning