A $10,000 note that has a stated interest rate of 10% and is due in six months would have interest of $1,000.

Name: A $10,000 note that has a stated interest rate of 10% and is due in six months would have interest of $1,000.
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Question

Quizplus · Accepted Answer

The formula used to calculate interest in the question is incorrect. The correct formula is:
Interest = face value x annual interest rate x fraction of year
Using that formula: 
Interest = $10,000 x 0.10 x (6/12) = $500 
Therefore, the correct answer is B) False.

A $10,000 Note That Has a Stated Interest Rate of 10