Quote: Nelson charged $542.95 for a new printer on May 12 and $56.79 for a restaurant bill on May 22. Calculate the interest charged, at 19.5% simple interest, on the payment date of June 21st.
(RECALL: I = PrT)
Okay, so I am having troubles figuring out how to calculate this. Examples I have are helpful to a point, but unfortunately do not show me exactly what to do. :/ Please help.
The trick here is to note that the interest is annual but you have a fraction of a year as the period.
You have to make some assumptions here. I'm guessing that they intend the interest to start accumulating from the day of the transaction.
You just have to treat each one separately
June 21 - May 12 = 40 days = 40/365 yrs
so the interest due on the printer is $542.95 * (0.195) * (40/365) = $11.60
June 21 - May 22 = 30 days = 30/365 yrs
so the interest due on the meal is $56.79 * (0.195) * (30/365) = $0.91
the total interest is just the sum of these i.e. $12.51
+39 
+6250 
