Simple discount

[Blake corey]

Vincent receive Php36, 480 today. (Febl9, 2020) from a loan of Php48.360. If he has to pay the amount he borrowed on Nov 24, 2020 what simple discount rate was charged?


Is F(1-dt) is the right formula for this or i need to add something?

 

[tkhunny]

One must be more clear and precise. Don't be afraid to WRITE OUT everything relevant.

d = Simple Discount Rate
t = Time in Years = (Nov 24, 2020 less Feb 19, 2020)/366 = 279/366 -- It's a Leap Year!
Proceeds = 36,480 = P
Loan Amount = Future Payment Amount = 48,360 = F

How many formulas do you have for Simple Discount? Try the one you showed.

It is often easier to understand if you do it in pieces.

F(1-dt) = F - Fdt = Loan Amount less Discount

Discount = Loan Amount less Proceeds = F - P = 48,360 - 36,480 = 11,880

11,880 = 48,360 * d * (279/366) -- You may need to use 365. Opinions vary. Ask your text book or your instructor for the required application.

What do you get? Loan Shark rates?