END-OF-CHAPTER PROBLEMS connect Check figures for odd-numbered problems in Appendix B. Name Date DRILL PROBLEMS Complete the following table for these simple discount notes. Use the ordinary interest method. LU 1 1-1(2) Amount due Discount Bank at maturity rate Time discount Proceeds 11-1. $6,000 3% 160 days 11-2. $2,900 61% 180 days Calculate the discount period for the bank to wait to receive its money: LU 11-2(1) Date of Length of Date note Discount note note discounted period 11-3. April 12 45 days May 2 11-4. March 7 120 days June 8 Solve for maturity value, discount period, bank discount, and proceeds (assume for Problems 11-5 and 11-6 a bank discount rate of 9%). LU 1 1-2(1, 2) Face value Rate of Length of Maturity Date of Date note Discount Bank (principal) interest note value note discounted period discount Proceeds 11-5. $50,000 11% 95 days June 10 July 18 11-6. $25,000 9% 60 days June 8 July 10 excel 11-7. Calculate the effective rate of interest (to the nearest hundredth percent) of the following Treasury bill. Given: $10,000 Treasury bill, 4% for 13 weeks. LU 1 1-1(4)WORD PROBLEMS Use ordinary interest as needed. 11-8. Carl Sonntagswanted to compare what proceeds he would receive with a simple interest note versus a simple discount note. Both had the same terms: $19,500 at 8% for 2 years. Compare the proceeds. LU 1 1-1(3) 11-9. Paul and Sandy Moede signed an $8,000 note at Citizen's Bank. Citizen's charges a 6,% discount rate. If the loan is for 300 days, find (a) the proceeds and (b) the effective rate charged by the bank (to the nearest tenth percent). LU 1 1-1(3) 11-10. You were offered either a simple interest note or a simple discount note with the following terms: $33,353 at 7% for 18 months. Based on the effective interest rate, which would you choose? LU 11-1(3) 11-11. On September 5, Sheffield Company discounted at Sunshine Bank a $9,000 (maturity value), 120-day note dated June 5. Sunshine's discount rate was 9%. What proceeds did Sheffield Company receive? LU 1 1-2(1) 11-12. The Treasury Department auctioned $21 billion in 3-month bills in denominations of $10,000 at a discount rate of 4.965%. What would be the effective rate of interest? Round only your final answer to the nearest hundredth percent. LU 11-1(4) 11-13. There are some excellent free personal finance apps available: Mint.com, GoodBudget, Mvelopes, BillGuard, PocketExpense, HomeBudget, and Expensify. After using Mint.com, you realize you need to pay off one of Money your high interest loans to reduce your interest expense. You decide to discount a $5,250, 345-day note at 3% est cent. LU 1 1-2(1) to your bank at a discount rate of 4.5% on day 210. What are your proceeds? Round each answer to the near-11-14. Ron Prentice bought goods from Shelly Katz. On May 8, Shelly gave Ron a time extension on his accepting a $3,000, 8%, 180-day note. On August 16, Shelly discounted the note at Roseville Bank What proceeds does Shelly Katz receive? LU 11-2(1) excel 11-15. Rex Corporation accepted a $5,000, 8%, 120-day note dated August 8 from Regis Company in settleme a past bill. On October 11, Rex discounted the note at Park Bank at 9%. What are the note's maturity va discount period, and bank discount? What proceeds does Rex receive? LU 11-2(1) 11-16. On May 12, Scott Rinse accepted an $8,000, 12%, 90-day note for a time extension of a bill for goods boug by Ron Prentice. On June 12, Scott discounted the note at Able Bank at 10%. What proceeds does Sco receive? LU 11-2(1) 11-17. Robinson's, an electrical supply company, sold $4,800 of equipment to Jim Coates Wiring, Inc. Coates signed a promissory note May 12 with 4.5% interest. The due date was August 10. Short of funds, Robinson's con- tacted Capital One Bank on July 20; the bank agreed to take over the note at a 6.2% discount. What proceeds will Robinson's receive? LU 11-2(1) 11-18. At www.daveramsey.com's Financial Peace University (FPU), Dave recommends Seven Baby Steps. One of these steps is "Pay off debt using the debt snowball." After graduating from FPU, Courtney Lopez-Munoz Money is trying to calculate the effective interest rate she is paying for a $1,789 simple discount note at 51% for 15 months. What rate has she been paying? Round to the nearest tenth percent. Do not round denominator calculation. LU 1 1-2(1)