Web Application Chapter 8 page 322

Five years ago, Freda's American dream came true. With the help of Bank America, she opened Conway's Recording Studio. The assistance she received from Bank America ranged from starting her business to running it to preparing for growth. By typing in www.bankamerica.com/business/planners/bb_startbus3.html and selecting Nine Steps in Starting a Business, answer the following questions.

1. Step three in starting a business deals with obtaining financing. What two types of financing are mentioned?

2. The parking lot of Conway's Recording Studio is in need of repair. Freda's loan through Bank America has already been approved, but she was given a choice of two different notes. Both notes have a face value or proceeds of $16,000 for 90 days. One note has a simple interest rate of 8%, while the other note has a simple discount rate of 8%. For each type of note, calculate the interest and maturity value (face value). Use the ordinary interest method.

Show your work and include the date of the information used in your answer.

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