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ew History Bookmarks People Window Help a 370 Secure https://www. udent/PlayerTest aspx?testld 180022133&centerwin; MS 110 Alma Camilo & I 3/15/182 Quiz: Quiz 2 CH 9 Subm This Question: 1 pt 22 of 25(20 complete) This Quiz: 25 pts p A son sged a 45-day simple discount role with a fa value of $14,000 and a rate of 10% on Aug. Thelender sels te rote at a deaunt of 15% on Aug Find the prooeeds of the original note, the discount period, the discount, and the proceeds at the sale of the note on Aug. 21.Use banker's interest of 380 days E Click the loon to view the Number of Each of the Days of the Year table The proceeds ofthe original note are Round to the nearest cent.) The discount period isdays. The discount is (Round to the nearest cent) The proceeds of the sale of to note on Aug. 21 aro Enter your answer in each of the answer boxes 8

Explanation / Answer

The proceeds of the original note is $14,000

The discount period is length of time between a note's sale and its due date. In this case, it would be the period from Aug 21 to Sep 23 ( 45 days fro Aug 9) which is 33 days

The discount value is calculated as under -

Maturity Value = Principal + Interest = $14000 + $14000 * 16% * 45/360 = $14280

discount value is $14,280 * 15% * 33/360 = $196.35

The proceeds from sale is Maturity Value - Discount = $14,280 - 196.35 = $14083.65

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