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Module10 2

The document discusses simple interest and how to calculate exact and ordinary interest over actual and approximate time periods. It provides examples of finding the actual and approximate number of days between dates using a hand calculator method. The objectives are to define simple interest, solve simple interest problems, and calculate exact and ordinary interest using actual and approximate time periods.

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Colleen Mae San Diego
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© © All Rights Reserved
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Download as PPTX, PDF, TXT or read online on Scribd
31 views

Module10 2

The document discusses simple interest and how to calculate exact and ordinary interest over actual and approximate time periods. It provides examples of finding the actual and approximate number of days between dates using a hand calculator method. The objectives are to define simple interest, solve simple interest problems, and calculate exact and ordinary interest using actual and approximate time periods.

Uploaded by

Colleen Mae San Diego
Copyright
© © All Rights Reserved
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
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Welcome to General Mathematics!
Module 10.2:

Simple Interest
A C T U A L A N D A P P R O X I M AT E T I M E
EXACT AND ORDINARY INTEREST
Exercise:
Complete the table by finding the unknown.

Maturity
Simple
Principal (P) Rate (r) Time (t) Value
Interest (Is)
(F)

50, 000 0.5% 3 months (1)____ (2) ____


(3) ____ 20% 4 years 125, 000 (4) ____
45, 500 (5) ____ 10 years (6) ____ 60, 000
Learning Objectives
At the end of this module you will be
able to
 define simple interest mathematically;
 solve for simple interest, principal amount, simple interest
rate, time of simple interest, maturity value; and
• solve for exact and ordinary interest of actual and
approximate days.
01

02

01 03

Actual and 04

Approximate 05

Time 06
NUMBER OF DAYS BETWEEN TWO DATES:
ACTUAL AND APPROXIMATE
1. Actual time - obtained by counting each day of
every month of the term,
excluding the origin date.

2. Approximate time - obtained by assuming that


every month has 30 days and
then counting again each day of
every month, excluding the
origin date.
THE HAND CALCULATOR

Jun Sept
July Apr Nov Aug
May
Feb Oct
Mar Dec
Jan

Knuckles are all 31 days


Spaces are all 30 days except for February which can be
either 28 or 29 days in a leap year
ACTUAL AND APPROXIMATE TIME
EXAMPLE #1:
Find the actual time and approximate time between March 16,
2017 and August 23, 2017.
ACTUAL AND APPROXIMATE TIME
other example:
Find the actual time and approximate time between
November 5, 2003 and April 13, 2006.
01

02

02 03

Exact and 04

Ordinary 05

Interest 06
EXACT AND ORDINARY INTEREST
Ordinary interest is calculated on the basis of a 360-day
year or a 30-day month. Exact interest is calculated on a
365-day year. The interest formulas for both ordinary and
exact interest are actually the same, with time slightly
differing when given as number of days.

Ordinary Interest, for D days

Exact Interest , for D days


EXACT AND ORDINARY INTEREST:
ACTUAL AND APPROXIMATE DAYS
There are four varieties of interest between two dates:

1. Ordinary interest at actual no. of days “Banker’s rule”

2. Ordinary interest at approximate no.of days

3. Exact interest at actual no.of days

4. Exact interest at approximate no.of days


STEP 1: IDENTIFY THE GIVEN
INFORMATION
STEP 2: DETERMINE THE TIME
BETWEEN GIVEN DATES
STEP 3: FIND THE EXACT INTEREST AT
ACTUAL TIME
STEP 4: FIND THE EXACT INTEREST AT
APPROXIMATE TIME
STEP 5: FIND THE ORDINARY INTEREST
AT ACTUAL TIME
STEP 6: FIND THE ORDINARY INTEREST
AT APPROXIMATE TIME
EXACT AND ORDINARY
INTEREST
EXAMPLE:
Find the ordinary and exact interest of the amount Php
15,000 at 12.5% interest rate using the (a) actual and (b)
approximate number of days from October 3, 2010 to
March 30, 2011

a. Exact interest at actual time


b. Exact interest at approximate time
c. Ordinary Interest at actual time
d. Ordinary interest at approximate time
EXACT AND ORDINARY
INTEREST
JustinEXAMPLE:
invested P40,000 on March 1, 2020 to August 13,
2020 at 17% interest rate. Compute for the interest on the
investment using:

a. Exact interest at actual time


b. Exact interest at approximate time
c. Ordinary Interest at actual time
d. Ordinary interest at approximate time
GOT SOME
QUESTIONS?

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