Question

carlos takes out a loan for $10,200, at 8% ordinary interest. if the amount of interest is $244.80, what is the time period (in days) of the loan? round any fraction to the next higher day.

Explanation:

Step1: Recall ordinary interest formula

The formula for ordinary interest is $I = P \times r \times \frac{t}{360}$, where $I$ is interest, $P$ is principal, $r$ is annual interest rate, and $t$ is time in days. Rearranged for $t$: $t = \frac{I \times 360}{P \times r}$

Step2: Plug in given values

$I = 244.80$, $P = 10200$, $r = 0.08$
$t = \frac{244.80 \times 360}{10200 \times 0.08}$

Step3: Calculate numerator and denominator

Numerator: $244.80 \times 360 = 88128$
Denominator: $10200 \times 0.08 = 816$

Step4: Compute and round up

$t = \frac{88128}{816} = 108$

Answer:

108 days