Answer:
given,
Amount borrowed = $71500
Time = 200 days
interest rate = 7.5 %
ordinary interest rate for year = [tex]71500\times \dfrac{7.5}{100}[/tex]
                         = $5362.5
exact interest rate for the year = [tex]71500\times \dfrac{7.5}{100}\times \dfrac{200}{365}[/tex]
                          = $2938.35
hence, the exact interest rate is less than the ordinary interest rate which means you should choose exact interest rate.
