On July 1, 2020 Trolley & Train World borrowed money from First Friendly National Bank by issuing a $25,000, 90 day, non-interest bearing note. The note was discounted to 14%.

Required:
Compute the following: Use 360-days in a year.

1. How much money did Trolley and Train World receive?

2. What was the total amount of interest paid?

3. What is the effective 90 day interest rate on this note? Round percentage to two decimals.

4. What is the approximate annual effective interest rate on this note payable? Round your intermediate calculation to four decimal places and your final answer to two decimal places.

Answer rating: 100% (QA)

Answer 1 Amount received by Trolleey and Train Bearing Note price Discount rate ... View the full answer