EXERCISE 15 1. In how many years will $2000 earn $420 at 6% interest? 2. What principal will earn $250 in 2 yr. at 5% interest? 3. What rate of interest has been earned on $750 if the interest for 6 mo. is $30? 4. How much money must be invested at 8% for 1 yr. and 6 mo. to give an income of $500 during that time? 5. How long will it take $950 to amount to $1330 at 5%? 6. At what rate must $600 be invested for 6 mo. to earn $24 interest? 7. In how many years will $1000 earn $1000 interest if the money is invested at. 6% (simple) interest? 8. Find the interest on $400 at 43% for 5 yr. 9. At what rate must $8000 be invested for 3 yr. to amount to $10,000? 10. What principal, invested at 6%, will earn $3275 in one year? 11. What rate of interest is a man receiving from his property which is worth $6500, if he receives $227.50 from it every 6 mo.? 12. In Example 7 you determined how long it takes $1000 to double itself at 6% simple interest. Now find how long it takes $1000 to double itself at 8% simple interest. (This means that $1000 must earn $1000 interest.) 13. How long will it take $1000 to double itself at 5% simple interest? 14. A man has an income of $175 per month. a. How much is this per year? b. What principal, invested at 5%, will produce this income in 1 yr.? 15. What rate of interest is being earned on $25,000 if the income in 6 mo. is $1200? 16. How long will it take $1850 to earn $650 interest at 5%? 17. How much must a man have invested at 7% to produce $3500 per year income? 18. A man's income from his work is $225 per month. What amount, invested at 5%, will give him this same income? 19. How much income will a man receive semiannually from $1750 worth of 43% Liberty Bonds? 20. From an investment of $4700 a man receives an income each year of $550. What rate of interest does he receive on his money? 21. a. If a man pays $2 interest for the use of $50 for one month, what rate of interest per year is he paying? b. What interest would the man pay if he borrowed $50 from a bank, for one month, if the bank charged him 8%? 22. An advertisement of a 124-acre farm stated that it was for sale at $75 per acre, one third cash, and the balance to remain at interest at 6%. a. What was the price of the farm? b. What would the cash payment be? c. What would be the annual interest on the balance of the debt? SHORT CUTS IN COMPUTING INTEREST 12. Before studying the next section, recall that 10 mills make a cent. In other words, one mill is one tenth of a cent and can be written .001. Thus, 15 mills may be written .015; and 23 mills .023. Also, just as three and one half cents may be written .031, so 31 mills may be written .003. Thus, 1 mills may be written .001; and mill may be written .000. EXERCISE 16 1. How many mills are there in 2 cents? 2. How many cents are there in 45 mills? Write in decimal form: 13. The six-per-cent method of computing interest. The interest on $1 for 1 yr. at 6% is 6¢, or $.06. Therefore, the interest on $1 for 1 mo. at 6% is of 6e, or, 5 mills, or $.005. Since the interest for 1 mo. is 5 mills, the interest for 6 da., or mo., is 1 mill, or $.001. Since the interest for 6 da. is 1 mill, the interest for 1 da. is mill, or $.000. Memorize the following set of results: The interest on $10 is, of course, ten times the interest on $1; etc. The following examples show how to use these facts. Example 1. What is the interest at 6% on $785 for 5 mo. and 24 da.? Solution. 1. The interest on $1 for 5 mo. is 5X.005, or $.025 The interest on $1 for 24 da. is 4X.001, or 2. 3. .. the interest on $1 for 5 mo. 24 da. is 4. = $22.77. .. the interest on $785 for 5 mo. 24 da. =785X.029 . .004 $.029 Example 2. What is the interest on $375 for 1 yr. 8 mo. 14 da. at 6%? Solution. - 1. The interest on $1 for 1 yr. is 2. 3. 4. 5. .04 .002 $.102 The interest on $1 for 8 mo. is 8X.005, or EXERCISE 17 What is the interest on $1 at 6% for: = $38.38. Find as in Examples 1 and 2 (above) the interest at 6% 37. On $450 for 6 mo. 12 da. 38. On $1275 for 7 mo. 24 da. 39. On $325 for 8 mo. 10 da. 42. On $4000 for 1 yr. 1 mo. 6 da. 49. On $625 for 3 da.; and for 8 da. SUPPLEMENTARY TOPICS The remaining sections of this chapter may be studied or omitted according to the judgment of the teacher. Each of the three topics given is independent of each of the others. They are arranged in their order of importance. The first of them is usually taught. Interest by short-cut method. Compound interest. Section 15, page 31. Installment payment of debts. Section 17, Topic D. Simple interest table. Section 18, page 38. 14. A short-cut method of finding the interest at many other rates is based upon the six-per-cent method. Rule 1. - Find the interest at six per cent on the given principal for the given time, by the six-per-cent method. 2. From this find the required interest as in the following examples. |
