Flashcards
Chapter 10
Cards in this deck (12)
- 1InterestPrincipal x Rate x Time
- 2PrincipalAmount of money that is originally borrowed, loaned, or deposited.
- 3Maturity Value (MV)Principal plus interest (if interest is charged). Represents amount due on the due date.
- 4Simple InterestInterest is only calculated on the principal. In I=PxRxT, the interest plus original principal equals the maturity value of an interest-bearing note.
- 5Simple Interest FormulaSimple Interest (I) = Principal (P) x Rate (R) x Time (T)
- 6Exact InterestCalculating simple interest using 365 days per year in time.
- 7TimeExpressed as years of fractional years, used to calculate simple interest.
- 8Ordinary InterestCalculating simple interest using 360 days per year in time.
- 9Banker's RuleTime is exact days/360 in calculating simple interest.
- 10U.S. RuleMethod that allows the borrower to receive proper interest credits when paying off a loan in more than one payment before the maturity date.
- 11Adjusted BalanceThe balance after partial payment less interest is subtracted from the principal.
- 12—
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- Flash cards from chapter 10 to helps with the definition of the key terms.
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- Veronica Huninghake
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