Question

5 numeric 1 point a loan has a maturity value of $10,000. if the term is 200 days and the simple discount rate is 9%, find the proceeds for this loan. round to the nearest cent. answer

Explanation:

Step1: Calculate simple discount

Simple discount formula: $D = M \times r \times t$, where $M=\$10,000$, $r=0.09$, $t=\frac{200}{360}$ (using 360-day year for simple discount)
$D = 10000 \times 0.09 \times \frac{200}{360}$
$D = 10000 \times 0.09 \times 0.555556$
$D = 500$

Step2: Find loan proceeds

Proceeds = Maturity value - Discount
$P = M - D$
$P = 10000 - 500$

Answer:

$\$9500.00$