#### Jo-Jo1961

 On April 17, 2010, Janeen Camoct took out an 7.6% loan for $23,500. The loan is due March 22, 2011. Use ordinary interest to calculate the interest.  What total amount will Janeen pay on March 22, 2011? So far I have: 365 - - - - - - -23,500 x .076 x 339 divided by 360 for me comes up to 0.940 divided by 23,500= 24,973.43 which is not right. Ordinary interest in 360 days 107- (April 17th) ------- 258 +81 (March 22nd) ------ 339 #### HallsofIvy ##### Elite Member Okay, what you have calculated is that there are 339 days from April 17, 2010 to March 22, 2011. That is $$\displaystyle \frac{339}{365}= 0.929$$ of a year. At 7.6% simple interest rate, the interest will be (23500)(.076)(.929)=$1658.79.

Yes, (.076)(.929)= 0.0706 not ".940". And it is certainly NOT that divided by 23500.

#### ameerhamza

##### New member

you calculated 339 days between april 17 and march 22. that means 339/365 which gives 0.92 in year ...
to calculate interest
23500*0.076*0.92=1643

#### soroban

##### Elite Member
Hello, Jo-Jo1961

Evidently, no one understands ordinary interest.

On April 17, 2010, Janeen took out a 7.6% loan for \$23,500.
The loan is due March 22, 2011.
Use ordinary interest to calculate the interest.
What total amount will Janeen pay on March 22, 2011?

Formula: .$$\displaystyle I \;=\;P \times R \times T$$

Hence: .$$\displaystyle I \;=\;23,\!500 \times 0.076 \times\dfrac{339}{\color{red}{360}} \;=\;1681.816666 \;\approx\;\1681.82$$

Therefore, she will pay back: .$$\displaystyle \23,\!500 + 1,\!681.82 \;=\;\25,\!181.82$$

#### HallsofIvy

##### Elite Member
Yeah, we keep forgetting that there are only 360 days in a year!

#### stapel

##### Super Moderator
Staff member
Yeah, we keep forgetting that there are only 360 days in a year!
For certain banking "rules", yes, there are (assumed to be) only 360 days in a year. I'm sure this simplified things considerably, back when computations were done by hand, but it can makes things surprisingly complicated in this day of spreadsheets.

#### Jo-Jo1961

##### New member
Thank you to everyone....Special thanks to you soroban, I appreciate it. Have a great day

#### srmichael

##### Full Member
Thank you to everyone....Special thanks to you soroban, I appreciate it. Have a great day