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# Bankers Rule Interest Calculator

This calculator enables users to compute the interest accrued on loans or investments, using the Bankers Rule, which is based on a 360-day year. This method simplifies the calculation of interest for varying loan terms, making it a preferred choice for many financial institutions and individuals for its ease and adaptability.

## Formula of Bankers Rule Interest Calculator

The formula to calculate interest using the Bankers Rule involves a few simple steps:

1. Convert the Annual Interest Rate to a Decimal:
• Rate = Annual Interest Rate / 100
2. Calculate the Interest:
• Interest = (Principal * Rate * Time) / 360

Where:

• Principal: The initial amount of money invested or borrowed.
• Rate: The annual interest rate as a decimal.
• Time: The number of days the money is invested or borrowed.

This formula provides a quick way to calculate the interest accruing on a sum over a specified period based on a standardized 360-day year, which simplifies interest calculation across different periods.

## Table of General Terms

To aid in understanding, here's a table of general terms related to the Bankers Rule Interest Calculator, along with definitions and example values:

## Example of Bankers Rule Interest Calculator

For instance, if you invest \$10,000 at an annual interest rate of 5% for 90 days, using the Bankers Rule Interest Calculator, the interest would be calculated as follows:

• Rate = 5 / 100 = 0.05
• Interest = (\$10,000 * 0.05 * 90) / 360 = \$125