Compare the compound interest with simple interest


Problem 1: A loan for $3,500 with a simple annual interest rate of 11% was made on September 5 and was due on November 21. Find the ordinary interest.

Problem 2: Find the discount and proceeds on a $3,220 face-value note for three months if the discount rate is 9.5%. (Use the banker's rule.)

Problem 3: Shanquayle Jenkins needs to calculate the effective interest rate of a simple discount note for $15,250, at an ordinary bank discount rate of 7.81%, for 70 days. Find the effective rate.

Problem 4: A bank made a farmer a loan of $1,400 at 15% for three years compounded annually. Find the future value and the compound interest paid on the loan. Compare the compound interest with simple interest for the same period.

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Finance Basics: Compare the compound interest with simple interest
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