Answer to Question #292375 in Economics for Mark

Question

A man is required to pay 57500 pesos at the end of 15 days of 60000 pesos at the end of 60 days. Determine the rate of interest.

Answer 1

The rate of interest is:

$57500/(1 + i×15/365)^{365} = 60000/(1 + i×60/365)^{365},$

$(\frac{1 + i×12/73} {1 + i×3/73})^{365} = 60/57.5,$

1.0001166×(1 + 3/73i) = 1 + 12/73i,

i = 0.00095 per annum.