True or false about simple interest

Exercise and reference answers

Questions

1. Statement is true

   Yes

   Statement

   Simple interest is charged on the principal only.

2. Statement is true

   No

   Statement

   A percent can never exceed 100.

3. Statement is true

   Yes

   Statement

   The payoff is principal plus interest.

4. Statement is true

   No

   Statement

   Every bank counts a year as 365 days.

5. Statement is true

   Yes

   Statement

   Using 360 days makes the interest larger.

6. Statement is true

   Yes

   Statement

   A depositor also earns interest.

Instructions

Decide whether each statement is true or false.

Explanation