Amount of interest paid in 30 days on one year term
Calculate the amount of interest paid on $1000 at 10% for one year with first payment in 30 days.
Answer STEP 1:
Our aim is to find the amount of interest for 30 days. The formula used to calculate the simple interest
I = Prt
denotes the principal, r
represents the rate of interest for one year, and t
is the time in years.STEP 2:
Since the time period is 30 days, we are required to convert the number of days into an equivalent number of years. It is a known fact that a year consists of 365 days. This means that we have to divide 30 days by 365 days to get the equivalent number of years.STEP 3:
Now, we have to convert the rate of interest to a decimal by dividing it by 100.STEP 4:
Finally, we will substitute all the known values in the formula for simple interest and evaluate.
The amount of interest paid in 30 days is about $8.22