question 5 of 10\nearls savings account has an apr of 7.3%, calculates interest daily, and pays\ninterest at…

question 5 of 10\nearls savings account has an apr of 7.3%, calculates interest daily, and pays\ninterest at the end of the month. if during the month of june, his balance was\n$400 for the first 10 days of the month, $1500 for the next 10 days of the\nmonth, and $600 for the last 10 days of the month, how much total interest\ndid earl earn in june?\na. $2.30\nb. $3.00\nc. $2.80\nd. $5.00

question 5 of 10\nearls savings account has an apr of 7.3%, calculates interest daily, and pays\ninterest at the end of the month. if during the month of june, his balance was\n$400 for the first 10 days of the month, $1500 for the next 10 days of the\nmonth, and $600 for the last 10 days of the month, how much total interest\ndid earl earn in june?\na. $2.30\nb. $3.00\nc. $2.80\nd. $5.00

Answer

Answer:

A. $2.30

Explanation:

Step1: Calculate daily interest rate

Annual Percentage Rate (APR) = 7.3% = 0.073. Daily interest rate ( r=\frac{0.073}{365}=0.0002 )

Step2: Calculate interest for each period

  • For the first 10 - day period: ( P_1 = 400 ), ( I_1=P_1\times r\times10=400\times0.0002\times10 = 0.8 )
  • For the second 10 - day period: ( P_2 = 1500 ), ( I_2=P_2\times r\times10=1500\times0.0002\times10 = 3 )
  • For the third 10 - day period: ( P_3 = 600 ), ( I_3=P_3\times r\times10=600\times0.0002\times10 = 1.2 )

Step3: Calculate total interest

Total interest ( I = I_1+I_2+I_3=0.8 + 3+1.2=2.3 ) (There was a miscalculation in the addition step above. The correct total is (0.8+1.2 + 0.3=2.3)). So Earl earned $2.30 in interest in June.