Find the date of maturity, the term of discount, the bank discount, and the proceeds of the following: 3. A 30-day note for $5000, without interest, dated Aug. 27, discounted Aug. 27 at 6%. 4. A 15-day note for $10,000, without interest, dated May 1, discounted immediately at 5 %. 5. A 90-day note for $7500, without interest, dated Nov. 18, discounted Nov. 19 at 6%. 6. A 10-day note for $18,000, without interest, dated July 28, discounted the same day at 5%. 7. A 120-day note for $3200, without interest, dated Sept. 30, discounted the same day at 7%. 8. A 60-day note for $840, with interest at 6 %, dated Oct. 12, discounted Nov. 2 at 6%. 9. A 30-day note for $3000, with interest at 5%, dated July 3, discounted July 5 at 6%. 10. A 45-day note for $60,000, with interest at 4%, dated Dec. 28, discounted Jan. 2 at 5%. 11. A 90-day note for $8200, with interest at 6 %, dated Feb. 1, 1907, discounted the same day at 7%. 12. A 60-day note for $25,000, with interest at 6%, dated Feb. 1, 1908, discounted Mar. 1 at 4%. 13. A note for $4000 on interest for 4 months at 6%, dated Jan. 1, 1907, discounted Jan. 10, 1907, at 6%. 14. A 60-day note for $75,000, without interest, dated Apr. 7, discounted Apr. 7 at 3%. 15. A note for $7200 on interest for 3 months at 6%, dated July 17, discounted Sept. 1 at 4%. 16. A 10-day note for $1000, discounted at 31% on the day it was made. 17. The following represents a bank's purchases of notes on the first of November: Find the amount invested in notes that day. 18. Find the face of a 60-day note that, discounted at 6% on the day it is made, will realize $9900 in cash. SUGGESTION. The proceeds of $1 discounted for 60 days at 6% = $.99. 19. For what sum must I draw my note for 60 days to obtain $2975 in cash, if the rate of discount is 5% ? 20. For what sum must a 90-day note be drawn to realize $19,775 in cash when the rate of discount is 41%? SAVINGS BANK ACCOUNTS 448. Savings banks pay the depositors compound interest, compounding it either monthly, quarterly, or semiannually. 449. The interval between the dates at which interest is paid is called the interest term. Quarterly interest terms begin Jan. 1, Apr. 1, July 1, and Oct. 1; semiannual terms begin Jan. 1 and July 1, or Apr. 1 and Oct. 1. 450. The bank books of depositors in savings banks must be presented both when deposits are made and when money is drawn out, the amounts being credited or charged as the case may be. Books should also be presented at the bank at the end of each interest term to have interest credited. 451. The most general custom with savings banks is to credit interest, at the end of every interest term, on the smallest balance on deposit during the entire term. Usually no interest is computed on the cents of the balance. Custom varies greatly with different banks and in different localities. Frequently interest is allowed for the rest of the term on deposits made on the first (or within a few days of the first) of any month of the term. On the other hand, some banks subtract withdrawals from the balance at the beginning of the term and credit interest only on the difference obtained, which may be less than the smallest balance during the term. 452. The following is an illustrative statement of deposits and withdrawals with interest compounded quarterly at 3% The statement shows that the deposit of Dec. 15, 1905, did not begin to draw interest until Jan. 1, 1906, and the interest for the quarter from Jan. 1 to Apr. 1 was computed on the smallest balance for the quarter, namely, $245. Similarly, $1.84 is the interest on $246 for 3 months, and $1.97 is the interest on $263 for three months. NOTE. The fractional part of a cent in the interest is usually dropped. Local customs, in regard to all points concerning which the usage of banks differs, should be followed. The answers in this book, however, are based on the method of solution just given. WRITTEN EXERCISES 453. Arrange the following as in a savings bank book, and find the balance due Jan. 1, 1907: 1. Interest quarterly (Jan. 1, Apr. 1, etc.) at 4%. Deposits: Aug. 8, 1905, $ 425; Oct. 2, 1905, $100; June 30, 1906, 150; Sept. 3, 1906, $80. Withdrawals: Sept. 18, 1905, $ 35; Mar. 19, 1906, $ 250. 2. Same as exercise 1, except interest semiannually (Jan. 1 and July 1). 3. Interest quarterly (Jan. 1, Apr. 1, etc.) at 4%. Deposits: Jan. 30, 1906, $85; Feb. 18, 1906, $45; Mar. 8, 1906, 100; Mar. 29, 1906, $50; June 2, 1906, $125. Withdrawals: Apr. 13, 1906, $60; Sept. 1, 1906, $ 80. 4. Same as exercise 3, except interest semiannually (Jan. 1 and July 1) at 3 %. 5. Same as exercise 3, except interest semiannually at 3%. 6. Interest semiannually (Jan. 1 and July 1) at 3 %. Deposits: Jan. 2, 1906, $ 250; Jan. 15, 1906, $75; Feb. 3, 1906, $125; Mar. 12, 1906, $ 175; June 4, 1906, $ 60. Withdrawals: Feb. 28, 1906, $10; Apr. 2, 1906, $50. 7. Interest quarterly (Jan. 1, Apr. 1, etc.) at 31 %. Balance, July 2, 1906, $147.12. Deposits July 7, 1906, $15.50; Sept. 12, 1906, $ 25; Oct. 12, 1906, 60; Nov. 10, 1906, $22.50. Withdrawals: Oct. 2, 1906, $16; Dec. 12, 1906, $ 35. 8. Interest semiannually (Jan. 1 and July 1) at 31%. Deposits: Jan. 2, 1902, $400; Mar. 6, 1902, $200; Aug. 5, 1902, $150; Jan. 2, 1903, $125; May 6, 1903, $85; Oct. 1, 1903, $110; Jan. 15, 1904, $75; Sept. 23, 1904, $120; Mar. 4, 1905, $60; July, 1, 1905, $50; Dec. 2, 1905, $12; Feb. 1, 1906, $44; July 2, 1906, $ 36. Withdrawals: None. EXCHANGE 454. Paying debts or collecting credits in distant places without actually transferring money is called exchange. 455. The various methods of exchange explained in the following pages are by postal money order, by express money order, by bankers' association money order, by telegraphic money order, by check, by bank draft (similar to a check), and by foreign bill of exchange (similar to a draft). 456. Exchange between two places in the same country is called domestic, or inland, exchange; exchange between two places in different countries is called foreign exchange. DOMESTIC EXCHANGE 457. A postal money order is an order made by the postmaster in one place on the postmaster in another to pay to the person named therein a specified sum of money. It is negotiable. In addition to the face, money orders cost as follows: For orders for sums not exceeding $ 2.50 $20.00 3 cents. 5 cents. 8 cents. ......10 cents. $ 30.00 .....12 cents. $40.00 .15 cents. $50.00 ......18 cents. Over $50.00 and not exceeding Over $60.00 and not exceeding Over $75.00 and not exceeding NOTE. The maximum amount for which a single order may be issued is $100. When a larger sum is to be sent, additional orders must be *ained. |