31. What premium must be paid for insuring goods to the value of 5501 at 3 per cent so that in case of loss the party insured shall be entitled not only to the value of the goods but also to the premium of insurance? 32. What sum must I insure to recover the amount of goods value 5841, together with premium of insurance and all charges being 4 per cent? 33. If my expenses be 77 10s premium, policy 5s. Od. brokerage 259. Od. and other charges 25s. what sum ought I to insure to recover all the expenses and the value of the property supposing it to be worth 2500/? Questions relating to the purchase of stock,† may be included in this rule. Where the hundreds are even which is most generally the case, multiply the price by the number of hundreds. Examples. What must be given for 700 new 4 per cent debentures, at 101 per cent? £101 10 £710 10 If the current price of stock to be transferred is less than 1007, multiply the stock by the rate per cent, and the product divided by 100 will give the purchase. If the price of stock be more than 1007, multiply the quantity to be transferred by such part of the rate per cent as exceeds 100; divide this product by 100 as before to which add the given stock for the total purchase. Or, as 100 the stock to be transferred, so is the rate per cent or current price, to its current value. The same may be effected by aliquot parts, as was explained in the first examples under the present head. *NOTE.--In business it is usual to charge Insurance for even money, so that such examples though they may be useful exercises, are for the most part useless in real insurance transactions, as the premium is at once found by multiplying the number of hundreds by the rate per cent. In such cases as above described, merchants calculate the nearest even sum to cover their risk, and are not in general, particular as to the exact amount 207 or 307 not making much difference. † Stock is a general name for the money borrowed by government and the capitals of trading companies. There is generally some small additional expense more than the rate or selling price, which is usually 2s. 6d. or § per cent. Examples. What must be given for 480116s, 3 ct.annuities at 71 pr.ct? What must be given for the purchase of 1170/ 12s. Od. 4 per cent annuities, at 105 per cent? £1170 12 0 Or thus, 1007 [1170 12 0 5 = 0 58 10 7+ £1229 2 7teract 58 10 7 Answer, £1229 27 Suppose I have 10007, what nominal sum in 3 per cent debentures will it purchase, at 72 per cent? 72 1000 :: 100 Suppose I have made the purchase as last described; what rate of interest do I receive? Answer, £3 17 5 per cent. QUESTIONS FOR PRACTICE. 1. Suppose I have 6007, what nominal sum in new 41 per cent debentures will that purchase at 10331 per cent, allowing the broker per cent on the capital, or sum purchased? 2. What is the purchase of 5751 15s bank stock, at 2251 pr.et? 3. Suppose 4 per cent debentures are 1041 per cent; what rate of interest do I receive? 4. Suppose a person has 9501 to invest in the 3 per cent consuls, which are, suppose 72 per cent; what sum must he give an order to his broker for, so that including the brokerage, it may exactly cost him the sum he has to lay out? INTEREST. INTEREST is the premium, or money which one person allows to another for the use of any sum of money, for a determinate space of time. The principal is the money lent. The rate per cent is a certain sum, agreed upon between the borrower and lender, or determined by the laws of the country in which the parties live, to be paid for the use of every 1007 in the principal, for a year. The greatest legal interest in England is 51, and in Ireland 61 per cent., but in the colonies belonging to the British dominions, and other countries, a much higher rate of interest is allowed. The amount, is the principal and its interest added together. Simple interest is the money arising from the principal only, though such interest remain unpaid any number of years; thus, if the interest of 100 for 1 year, be 51, it will be 101 for 2 years, and 27 10s. for half a year; 11 5s. Od. for a quarter of a year, and 8s. 4d. for a month. Compound Interest is the money arising, not only on the original principal, but also on the interest as it becomes due ; but as it is not legal to charge compound interest on money lent in Ireland, I shall confine myself to SIMPLE INTEREST, In Simple Interest, five quantities are concerned, the principal, the rate, the time, the interest and amount; any three of these being given, except the principal, interest and amount, the other two can be found. Hence, the rule admits of several problems, the most important, and that which will justly claim most attention in what follows, is that in which the principal, the rate and time are given to find the interest and amount; for resolving this, the following is the GENERAL RULE. As 100 is to the principal, so is the rate per cent, or value paid for the use of 1007, to its interest for 1 year. As 1 year is to any other time, so is the interest for 1 year to the interest for that time. Though this rule is general for all cases of this problem, yet calculations in interest may be much shortened by means of aliquot parts and other devices, which are illustrated in the following cases. CASE 1st. To find the interest of 1001 for years at any rate per cent. Multiply the number of years by the rate per cent, the product is the answer, Examples.. 1. What is the interest of 100l for 5 years at 6 per cent? lyr.: 5yr.:; 61: 30 the answer, or 5×=301? 2. What is the interest of 1001 for 4 3. What is the interest of 1001 for 34 4. What is the interest of 1001 for 7 ? years at 6 cent for months at any rate As 12 months given months :: rate to the interest, or multiply the months by the rate and divide by 12. If the rate is 6 per cent it is 10s. for each month, therefore half the months will be the interest, to which may be added or subtracted such aliquot part or parts of 6, to or from the interest thus found, as the given rate may be greater or less than six. per ct? per ct? per ct? 6. What is the interest of 1001 for 9 months, at 4 7. What is the interest of 1001 for 7 months, at 4 8. What is the interest of 1001 for 11 months, at 7 CASE 3d. To find the interest of 1001 for years and months at any rate per cent. per annum. Make the months the fraction of a year, then multiply the years and fraction thereof, by the rate per cent. Ог may be performed as in the former case. Examples. 9. What is the interest of 1001 for 3 years and 5 months, at 5 per cent? yr mo 3 53 X5=17, or 171 1s. 8d. 10. What is the interest of 1001 for 4 years and 3 months, at 6 per cent per annum ? 11. What is the interest of 1007 for 6 years and 9 months, at 5 per cent per annum ? 12. What is the interest of 1007 for 5 years and 7 months, at 4 per cent per annum? 13. What is the interest of 1001 for 3 years and 4 months, at 7 per cent. per annum? 14. What is the interest of 1001 for 8 years and 2 months at 5 per cent per annum? - CASE 4th. To find the interest of any sum for one year, at any rate per cent per annum. Multiply the given sum by the rate, and divide the produet by 100. Or, If the rate is an aliquot part of 1007, divide the given principal by the denominator of such aliquot part; but where there are more parts than one, in the given rate, the former rule is preferable. 5 Examples. 15. What is the interest of 3251 12s. 6d. for one year, at per cent per annum ? |