Question

Nolan Walker decided to buy a used snowmobile since his credit union was offering such low interest rates. He borrowed $4,400 at 4.75% on December 26, 2019, and paid it off February 21, 2021. How much did he pay in interest? (Assume ordinary interest and no leap year) (Use Days in a year table) (Do not found intermediate calculations. Round your answer to the nearest cent.) 56 Interest paid 5 24600 References

Answer 1

9514 1404 393

Answer:

  $240.93

Step-by-step explanation:

We don't have your "Days in a Year Table," so we will go by the definition of "ordinary interest." That term refers to a year of 12 months of 30 days each.

Here, the term of the loan is 1 year plus two months, less 5 days. That is, the interest period in years is 1 +(2×30 -5)/360 = 83/72 years.

So, the interest on the loan was ...

  I = Prt = $4400×0.0475×83/72 = $240.93