ALWAYS COUNT DAYS FOR PROMISSORY NOTES!!!

CHAPTER 7 & 8: SIMPLE INTEREST FORMULA'S

Interest: I = PRT

Maturity Value: S = P + I

Maturity Value or Future Value: S = P (1 + rt)

Principal Value or Present Value: P = S

---------

(1 + rt)

Number of days in a month:

January 31 February 28 March 31 April 30 May 31 June 30 July 31 August 31 September 30 October 31 November 30 December 31

1) Fill in the missing values in the chart below. (1 mark each-4 total)

	Principal (P)	Rate (r)	Time (t)	Interest (I)
a.	$5,000	9 % p.a.	292 days
b.		5 % p.a.	26 months	$1,597.92
c.	$10,800	% p.a.	1.25 years	$1,653.75
d.	$800	9 % p.a.	_______months	$126.00

2) A 7-month promissory note with a face value of $20,000 was issued on March 12,2021, at 9 % p.a., determine. (4 marks total)

a. the maturity date (1 mark)

b. the number of days it was issued for (1 mark)

c. the interest on the note (1 mark)

d. the maturity value of the note (1 mark)