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Early repayment of a loan compounded daily

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  1. Jun 26, 2011 #1
    An amount of $5,000 is due on August 22nd of a leap year. What amount will settle the debt on February 5th of the same year? Assume that interest is compounded daily and use the Banker's Rule.

    Please help I do not even know where to start other than the Banker's rule is exact time and ordinary interest! Would really appreciate someone walking me through it or at least explaining how to start it. Thanks!!!
     
  2. jcsd
  3. Jul 3, 2011 #2
    Ok, let us start with the compounded interest equation. Study the quantities involve and relate to the equation.

    One question, was there interest rate given? I think we need it here, kindly check.
     
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