Smith and Duke's The American Statistical Arithmetic

Hence, to convert any currency to federal money, find the value of the dollar in terms of the standard unit of the other currency; then multiply the given sum by this fraction.

When the reduction is made to English currency, we multiply by, and the result will be pounds and decimals of a pound. The decimals of a pound are then reduced to shillings and pence.

Thus, reduce $45.25 cents to English currency.

Q. What fraction of £1 is $1? How are dollars brought to English currency? What is the general rule for bringing dollars to any other currency?

195. Since reducing federal currency to that of any other country is the reverse of the reduction in Case I., it follows that the multiplier in Case II. will be the fractions found for the several currencies in Art. 191, with their terms inverted. That is, to reduce federal money to New York currency, we multiply by; to New England currency, by, &c.

Q. When you know the multiplier for reducing foreign to United States currency, how may you pass back to the foreign currency? Why? By what do you multiply to pass to New York currency? To New England? To Georgia? To Pennsylvania? To Canada?

EXAMPLES.

1. Reduce $1000 to the several currencies.

$1000-£208 6s. 7d.+ English currency.

$1000 £250

$1000 £300

Ans. $1000-£400

$1000 £375

Canada

66

$1000 £233 6s. 7 d. S. Carolina

$1000

£500

66

N. Carolina (c

2. Reduce $1750.37 cents to the several currencies.

SIMPLE INTEREST.

196. INTEREST is the allowance made to the lender of money for the use of the money.

The Principal is the money on which the interest is paid.

The Amount is the principal and interest taken toge

ther.

Thus, if A borrow $100 from B, and promise to pay him $6 for the use of it for one year, the interest would be $6, the principal $100, and the amount $106; and B would receive at the end of the year $106; that is, the principal $100, and the interest $6.

Q. What is interest? What is the principal? The amount? How do you illustrate this?

197. The rate of interest is the interest of $100 for one year. When the rate is $6, it is called 6 per cent. interest; that is, $6 for the hundred. Interest at 7, 8, 9, &c. per cent. is an allowance of $7, $8, $9, &c. for the use of $100 for one year. The legal interest is the rate established by law. In most of the States it is 6 per cent. In New York

it is 7 per cent., and in Louisiana 8 per cent.

Q. What is the rate of interest? When the rate is $6, what is it called? What is meant by 6 per cent. interest? 7 per cent? 8? What is legal interest? What rate is legal interest in most of the States? What is the legal interest in New York? In Louisiana ?

198. To find the interest on any given principal for one year, we have only to multiply the principal by the rate per cent. and divide by 100, or cut off two places to the right for decimals.

Thus, the interest on $540 for one year at 6 will be $540x6=$32.40.

100

per cent. Since it is evident $100 : $6 :: $540: $32.40; that is, $100 will be to $6, its interest for one year, as $540 is to $32.40, its interest for the same time; and here the fourth term is found by multiplying the third term by 6 and dividing the product by 100.

Having thus found the interest for one year, that for 2, 3, or any number of years, will be ascertained by multiplying the interest of the given principal for one year by 2, 3, &c., since it is plain the interest of a given principal for 2 years will be double that for one year, for 3 years 3 times, &c.

Q. How do you find the interest on a given principal for 1 year? Why is this? How do you find the interest of a given principal for 2 or more years? The reason for this? What is the interest of $200 for 1 year at 6 per cent.? For 2 years? 3 years? 4? What is the interest of $500 for 1 year at 6 per cent.? For 2 years? 3 years? 10 years? What is the interest of $1000 for 1 year at 6 per cent.? For 2 years? 3 years? 10 years?

199. When the rate of interest is 6 per cent. for one year or 12 months, every two months will produce $1 for a principal of $100; that is, 1 per cent. upon the principal. Hence, to find the interest of any given principal for any number of years or months, we have the following general

RULE.

Multiply the given principal by half the number of months, and divide the product by 100, or what is the same thing, cut off two places of decimals from the right. Thus, to find the interest on $500 for 2 years and 5 months at 6 per cent.

There being 29 months in 2 years and 5 months, the multiplier is 14, and the result $72.50 is the

answer.

OPERATION.

$500

14 half no. of mos.

2000

500

250

Ans. $72.50

Again, find the interest of $475.50 for 3 years, 10 months,

Q. When the rate of interest is 6 per cent., what amount of interest will $100 produce in 2 months? What rate of interest will $1 per $100 be? What is the general rule to find the interest on any given principal for any number of years and months? What would be the multiplier if the time were 4 years and 2 months? How many days are calculated for a month in interest? How is the interest found for any number of days?