When Interest Is Calculated for Periods Shorter Than a Year,the

question 110

Multiple Choice

When interest is calculated for periods shorter than a year,the formula to calculate interest is:

• A)I = P x R x T,where I = interest calculated,P = principal,R = annual interest rate,and T = number of months.
• B)I = P x R x T,where I = interest calculated,P = principal,R = annual interest rate,and T = (number of months ÷ 12)
• C)I = P x R x T,where I = interest calculated,P = principal,R = monthly interest rate,and T = (number of months ÷ 12).
• D)I = (MV - P)/T,where I = interest calculated,MV = maturity value,P = principal and T = number of months.

---

Definitions:

Special Revenue Fund

A fund used by a government to account for revenue from specific sources that are legally restricted to expenditure for particular purposes.