How to calculate simple interest

For short-term notes and loans counted in days, fINTi gives simple interest on both a 360-day and a 365-day basis at once.

Problem

You lend $5,000 at 6% a year for 90 days. How much interest is due, on each basis?

Keystrokes

fFINx≷y
0.00
Start clean.
90n
90.00
The number of days.
6i
6.00
The annual rate.
5000CHSPV
−5,000.00
The principal.
fINTi
75.00
Interest on a 360-day year.
+
5,075.00
Principal plus that interest: the total due.
fINTiR↓x≷y
73.97
Interest on a 365-day year.
+
5,073.97
Principal plus that interest.

Answer

On a 360-day basis the interest is $75.00 and the total due is $5,075.00. On a 365-day basis it’s $73.97, for $5,073.97.

Why it works

fINTi puts the 360-day interest in X, the principal in Y and the 365-day interest in Z. That’s why + adds the principal, and why R↓x≷y brings the 365-day figure into view.

Which basis to use

Banks and money markets often use 360 days, which gives the lender slightly more. Many notes and consumer loans use 365. Check the agreement.

Questions

How do I count the days between two dates?

Use g ΔDYS. See the guide on days between dates.