SECTION XXXVII. BANKING. A BANK is a place of deposite for money, which is usually divided into shares, and owned by persons called stockholders. Its concerns are managed by a Board of Directors. It issues notes or bills of its own, intended to be a circulating medium of exchange or currency, instead of gold and silver. These bills are obtained from the bank by loans. When money is hired from a bank, it is the usual custom to deduct the interest at the time of receiving it. A man, therefore, who hires money from a bank, gives his note for a sum as much larger than he receives, as is the interest of the note for the given time. If a man therefore gives his note for $100, payable in 63 days, he receives only $ 98.95. A promissory note is said to be discounted, when it is received at a bank as a security for money taken from it; and the interest deducted is the discount. The interest on every note discounted at a bank, is computed for 3 days more than the time specified in the note; that is, if the note is payable in 60 days, the interest is taken for 63 days; for the law allows 3 days to the debtor, after the time has expired for payment, which are called days of grace. The rule for computing the discount is the same as in simple interest. EXAMPLES. 1. What is the bank discount on $476, for 30 days and grace 2. What is the bank discount on $1000, grace? 3. What is the bank discount on $7800, grace? ? Ans. $2.61.8. for 60 days and Ans. $10.50. for 90 days and Ans. $120.90. 4. What is the bank discount on $8000, for 60 days and grace? Ans. $84.00. 5. How much money should be received on a note for $760, payable in 5 months, discounted at a bank when the interest is 6 per cent. ? Ans. $740.62. 6. What sum is paid at a bank for a note of $1728, payable in 3 months? Ans. $1701.21.6. 7. A.merchant sold a cargo of hemp for $7860, for which he received a note, payable in 6 months. How much money will he receive at a bank for this note ? Ans. $7620.27. 8. A merchant bought 450 quintals of fish at $3.50 cash, and sold them immediately for $4.00 on 6 months' credit, for which he received a note. If he should get this discounted at a bank, what will he gain on the fish? Ans. $170.10. SECTION XXXVIII. BARTER. BARTER is the exchange of one kind of merchandise for another, without loss to either party. Questions in this rule are solved, by finding what quantity of goods, at a given price of one kind, are equal in value to another kind of goods, whose price is also given. EXAMPLES. 1. How much sugar at 12 cents per lb. must be given in barter, for 760 lbs. of raisins at 8 cents per lb. ? Ans. 4863.lbs. 2. What quantity of coffee at 17 cents per lb. must be given in barter for 760 lbs. of tea, at 62 cts. per lb. ? Ans. 2794,2.lbs. 3. A merchant delivered 3 hogsheads of wine at $1.10 per gal. for 126 yds. of cloth; what was the cloth per yd.? Ans. $1.65. 4. A has 12 cwt. of sugar, worth 8 cents per lb. for which B gave him 14 cwt. of cinnamon; what did B value his cinnamon? Ans. $0.54% per lb. 5. A had 41 cwt. of hops at $6.70 per cwt. for which B gave him 17 cwt. 3 qrs. 4 lbs. of prunes, and $88; what were the prunes valued at per lb. ? Ans. $0.0937. 996 6. A has sugar, which he barters with B for 4 cents per lb. more than it cost him, against tea, which cost B 40 cents per lb., but which he puts in barter at 50 cents. What did A's sugar cost him per ĺb. ? Ans. $0.16. 7. How many staves at $25 per thousand, must a merchant receive for 15 hogsheads of wine, at $1.25 per gallon? Ans. 47. M. staves. 8. Q has 670 bushels of oats, which cost him 35 cents per bushel; these he barters with Z at 50 cents per bushel for flour, that cost Z $5.00 per barrel. What is the bartering price of the flour, and how much will Q receive? Ans. 46 barrels of flour at $7.14% per barrel. SECTION XXXIX. COMPOUND INTEREST. THE law specifies, that the borrower of money shall pay a certain number of dollars, called per cent., for the use of one hundred dollars for a year. Now, if this borrower does not pay to the lender this per cent. at the end of the year, it is no more than just, that he should pay interest for the use of it, so long as he shall keep it in his possession; and this is called Compound Interest. 1. What is the compound interest of $300 for 3 years ? Ans. $57.30.4. RULE. Find the interest of the given sum for one year, and add it to the principal; then find the interest of this amount for the next year; and so continue until the time of settlement. Subtract the principal from the last amount, and the remainder is the compound interest. 2. What is the amount of $500 for 3 years? Ans. $595.50.8 3. What is the compound interest of $345 for 10 years? Ans. $272.84.2 4. What is the compound interest of $316 for 3 years, 4 months, and 18 days? Ans. 69.01.7. By the aid of the following Table, calculations are more easily effected, than by the preceding rule. TABLE, Showing the amount of 1 dollar, or pound, for any number of years under 50, at 5 and 6 per cent., compound interest. To perform questions by the Table, multiply the amount of one dollar by the given rate and time found in the Table, by the principal, and from the product subtract the principal, and the remainder is the compound interest. NOTE. If there be months and days, find the amount for them on the number taken from the Table, before it is multiplied by the principal. EXAMPLES. 5. What is the compound interest of $360, for 5 years, 6 months, and 24 days? Ans. $138.14. 1.338225= Amount of one dollar for 5 years. 5352900 4014675 .045499650 1.338225 = 1.383724650 = Amount of 1 dollar for 5 yrs. 6 mo. 24 days. 360 83023479000= Amount of principal for 5 yrs. 6 mo. 24 da. 415117395 498.14.0874000 360 = $138.14 Compound interest of the principal for do. 6. What is the interest of $890, for 30 years ? 7. What is the amount of $480, for 40 years? Ans. $4221.70.6. Ans. $4987.14.4. 8. What is the interest of $300 for 10 years, 7 months and 15 days? Ans. $257.40.1. 9. What is the amount of $586, for 12 years, 1 month, and 29 days, at 5 per cent. ? Ans. $1060.99.5. 10. The probable number of blacks, at this time, (1835) in the United States, is 2.500.000. Now, supposing their increase to be 25 per cent. for every 10 years, what will be their number in the year 1935 ? Ans. 23.283.057. 11. Supposing the annual increase of the people of color to be 2 per cent.; how many must be sent out of the country, each year, that their numbers might not increase ? Ans. 50.000. 12. What is the amount of $900 for 7 years at 5 per cent.? Ans. $1266.39. 13. What is the interest of $350 for 3 years, 3 months, 24 days? Ans. $74.77.5+ 14. What is the interest of $970 for 2 years, 9 months, and 24 days? Ans. $ 178.29.5. 14 |