Answer:
Step-by-step explanation:
Ordinary interest rate = principal × rates × ( time / 360)
exact interest rate = principal × rates × ( time / 365)
for states saving and loan of rate 7.25 %
ordinary interest rate = $ 2600 × 0.0725 × ( 90 / 360) = $ 47.125
total amount due after 90 days = $ 2647.125
for Security Bank of 7.5%
exact interest = $2600 × 0.075 × ( 90 / 365) = $ 48.75
amount due after 90 days = $ 2600 + $ 48.75 = $ 2648.75
b) considering the amount to be paid at maturity it is better to borrow state savings and Loan although the difference is not really much.
