Find the discount and proceeds on the simple discount note.
-Face value: $5,700.00 Discount rate: 11%
Time (days): 30
A)Discount: $627.00
Proceeds: $5,073.00
B)Discount: $52.25
Proceeds: $5,647.75
C)Discount: $0.00
Proceeds: $5,700.00
D)Discount: $51.53
Proceeds: $5,648.47

Question

Quizplus · Accepted Answer

The discount on a simple discount note is calculated using the formula: Discount = Principal × Rate × Time. Here, Principal = $5,700, Rate = 11% (or 0.11 as a decimal), and Time = 30/360 (since there are 360 days in a banker's year). So, Discount = $5,700 × 0.11 × (30/360) = $52.25. The proceeds are calculated by subtracting the discount from the face value: Proceeds = Face Value - Discount = $5,700 - $52.25 = $5,647.75.

Find the Discount and Proceeds on the Simple Discount Note