Question

what is the total payment required to pay off a promissory note issued for $800.00 at 10% ordinary interest and a 180 - day term? $? round to the nearest cent.

Explanation:

Step1: Recall the ordinary interest formula

The formula for ordinary interest is $I = P \times R \times \frac{T}{360}$, where $I$ is the interest, $P$ is the principal amount, $R$ is the annual interest rate (in decimal), and $T$ is the time in days.
Given $P = 800$, $R = 0.10$ (since 10% = 0.10), and $T = 180$ days.

Step2: Calculate the interest

Substitute the values into the formula:
$I = 800 \times 0.10 \times \frac{180}{360}$
First, calculate $\frac{180}{360} = 0.5$.
Then, $I = 800 \times 0.10 \times 0.5 = 800 \times 0.05 = 40$.

Step3: Calculate the total payment

The total payment $A$ is the principal plus the interest, so $A = P + I$.
Substitute $P = 800$ and $I = 40$:
$A = 800 + 40 = 840$.

Answer:

$\$840.00$