Answer:
The bank will discount 56.33 dollars
The note; after discounts, will be sufficient to purchase the dinning room set.
Explanation:
We are at June 5th
from May 12th this will be: 24 days
principal x discount rate x time = discount
6,500 x -0.13 x 24/360 = 56.33
nominal - discount = present value
6,500 - 56.33 = 6,443.67
Now we compare the price of the dinning room set with the net value of the note:
price of the dinning room
7,000 less 20% trade in = 7,000 - 1,400 = 5,600
6,443.67 > 5,600
