SIMPLE INTEREST

Section 8.2 (page 231-240)

SIMPLE INTEREST

Calculating the Number of Days

The time period t should be determined using the exact
number of days in the term.
For example, if a loan was advanced on September 21
and is repaid on December 21, we would have to count
the exact number of days in this term.
The most common practice is to count the starting date
but not the ending date; basically, we are counting the
number of days between the two calendar dates.

SIMPLE INTEREST

The Number of Days in Each Month

Month
January
February
March
April
May
June

Days
31
28 or 29
31
30
31
30

Month
July
August
September
October
November
December

Days
31
31
30
31
30
31

SIMPLE INTEREST

Example #1: By Hand

Calculate the number of days between March 21, 2007 and
September 18, 2007.

SIMPLE INTEREST

Example #1: The Table Method

Calculate the number of days between March 21, 2007 and
September 18, 2007.
1

Look up DAY NUMBER for each date:

Calculate the DAYS BETWEEN DATES:

SIMPLE INTEREST

Example #1: The Calculator Method

Calculate the number of days between March 21, 2007 and
September 18, 2007.
Press DATE.
Enter the first date: 03212007. Then press ENT and the
down arrow ().
Enter the second date: 09182007. Then press ENT and
the down arrow ().
Press COMP. The number of days between the dates will
appear, in this case 181.

SIMPLE INTEREST

Example #2: The Table Method

Calculate the number of days between March 21, 2007 and
November 6, 2008.
1

Look up DAY NUMBER for each date:

Calculate the DAYS BETWEEN DATES:

SIMPLE INTEREST

Example #2: The Calculator Method

Calculate the number of days between March 21, 2007 and
November 6, 2008.
Press DATE.
Enter the first date: 03212007. Then press ENT and the
down arrow ().
Enter the second date: 11062008. Then press ENT and
the down arrow ().
Press COMP. The number of days between the dates will
appear, in this case 596.

SIMPLE INTEREST

Example #3
Cole borrowed $5, 500 on June 7, 2009. How much interest
will he be charged, at a simple interest rate of 18%, if he is to
repay the loan on August 6, 2009?

SIMPLE INTEREST

Exercises
1

Calculate the number of days between February 18, 2012 and May
29, 2012.

Calculate the number of days between October 19, 2011 and April
4, 2012.

A $3, 800 loan with an annual simple interest rate of 10.75% was
advanced on June 17, 2011. How much interest was due when the
loan was repaid on October 1, 2011?

An $85, 000 investment earned a 6.9% p.a. rate of simple interest

from December 1, 2010 to May 30, 2011. How much interest was
earned?

SIMPLE INTEREST