BUSINESS MATHEMATICS

MAT 112
TUTORIAL 4D – SIMPLE INTEREST RATE EQUIVALENT TO BANK
DISCOUNT RATE

1. Find the simple interest rate that is equivalent to the discount rate of 9%
on a loan due in 60 days.
[9.14%]

2. A man receives RM6000 cash for a loan a bank which charges a discount
rate of 18% over a discount period of 8 months. Calculate the interest
rate this is equivalent to the discount rate.
[20.45%]

3. What is the discount rate that is equivalent to a simple interest rate of 8%

over a period of 300 days?
[7.5%]

4. A loan of RM12000 for a period of 3 months is approved to a borrower by

a bank that charges a discount rate of 13.5%. Find the interest rate that
is equivalent to the discount rate.
[13.97%]

5. Khairi wants to borrow RM2000 for 270 days from a bank that charges a
7% discount rate. Find the simple interest rate that is equivalent to the
discount rates.
[7.39%]

6. A bank discount all short-term six-month loans at 10%. What is the

equivalent simple interest rate?
[10.53%]

7. A bank discount all short-term sixty-day loans at 14%. What is the

equivalent simple interest rate?
[14.33%]

8. A bank discounts a rm4000 note due in six months using a bank discount
rate of 12%. Find the equivalent simple interest rate that is charged by
the bank.
[12.77%]