Find the discount and proceeds on the simple discount note.
-Face value: $13,230.00 Discount rate: 9.5%
Time (days): 250
A)Discount: $872.81
Proceeds: $12,357.19
B)Discount: $1,256.85
Proceeds: $11,973.15
C)Discount: $860.86
Proceeds: $12,369.14
D)Discount: $0.00
Proceeds: $13,230.00

Question

Quizplus · Accepted Answer

To find the discount, we use the formula Discount = Face Value * Discount Rate * Time / 360. Plugging in the given values, we get: Discount = 13,230 * 0.095 * 250 / 360 = $872.81. To find the proceeds, we subtract the discount from the face value: Proceeds = Face Value - Discount = $13,230 - $872.81 = $12,357.19. Therefore, choice A is the correct answer. To find the discount, we first calculate the interest (I) using the formula I = PRT/360, where P is the face value, R is the discount rate, and T is the time in days. Plugging in the values, we get I = (13,230)(0.095)(250)/360 = 872.81. The discount is therefore $872.81. To find the proceeds, we subtract the discount from the face value: $13,230.00 - $872.81 = $12,357.19. Option A matches these calculations.

Find the Discount and Proceeds on the Simple Discount Note