Exam 11: Promissory Notes, Simple Discount Notes, and the Discount Process

Lois Longin buys a $10,000 13-week Treasury bill at 11%. Use ordinary interest. What is her effective rate to nearest hundredth percent?

In calculating the bank discount when discounting an interest-bearing note, which one of the following is not used in the calculation?

The bank discount of an $18,000 non-interest-bearing, simple discount 8%, 90-day note is:

Compute bank discount using (A)ordinary interest, (B)proceeds, and (C)effective interest rate to the nearest hundredth. Do not round denominator in your calculation. Face Value Discount Rate Time in Days \ 9,000 14\% 110

Morris Bank discounts a 100-day note for $6,000 at 11%. Find (A)bank discount and (B)proceeds. Use ordinary interest.

On May 12, Joy Co. accepted a $1,000, 60-day, 6% note from Abe Wills, granting a time extension on a past-due account. Joy discounted the note at the bank at 9% on May 28. Use ordinary interest. Calculate Joy's proceeds.