Answer to Question #184196 in Financial Math for thara

Question

 Rama pays RM18,300 on 15 October 2018 for a loan of RM18,000 made on a certain date.The simple interest rate is 3% per annum. Determine the term of the loan (in days) and the date of the loan.

Answer 1

A = P(1 + r/n)

In the formula

• A = Accrued amount
• P = Principal amount
• r = Annual nominal interest rate as a decimal
• R = Annual nominal interest rate as a percent
• r = R/100
• n = number of compounding periods per unit of time
• t = time in decimal years
• I = Interest amount

$18300=18000(1+0.03t)$

$$t=0.55 days$$

The date of the loan was 16th october because it was half a day loan.