Answer :
1) The exact interest on $30,700 at 13 1/4% for 141 days is $1,609.01.
To calculate the exact interest, we need to use the formula: Exact Interest = Principal × Rate × Time.
In this case, the principal is $30,700, the rate is 13 1/4% (or 0.1325 as a decimal), and the time is 141 days converted to years (141/365 ≈ 0.3863).
Exact Interest = $30,700 × 0.1325 × 0.3863 = $1,609.01 (rounded to two decimal places).
2) The ordinary interest on $30,700 at 13 1/4% is $1,579.79.
To calculate the ordinary interest, we use the formula: Ordinary Interest = Principal × Rate × Time.
Since the time is given in days, we don't need to convert it to years.
Ordinary Interest = $30,700 × 0.1325 × 141/365 = $1,579.79 (rounded to two decimal places).
3) The amount by which the ordinary interest is larger is $29.22.
To find the difference between the exact and ordinary interest, we subtract the exact interest from the ordinary interest.
Difference = Ordinary Interest - Exact Interest
Difference = $1,579.79 - $1,609.01 = -$29.22 (rounded to two decimal places).
The negative sign indicates that the exact interest is larger than the ordinary interest.
The exact interest on $30,700 at 13 1/4% for 141 days is $1,609.01, the ordinary interest is $1,579.79, and the amount by which the ordinary interest is larger is $29.22.
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