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Let's break down and solve the problem.

### Information provided:
- **Promissory Note Amount (Principal):** RM 20,000
- **Simple Interest Rate:** 5% per annum
- **Maturity Date:** 2 August 2021
- **Note Duration:** 120 days
- **Discounted 60 days before maturity:** Madam Wong received RM 20,400 when the note was discounted 60 days before its maturity.
  
The task is to determine:
1. The **date of the note**.
2. The **maturity value**.
3. The **bank discount**.
4. The **bank discount rate**.

### (a) The date of the note
Since the maturity date is 2 August 2021, and the note has a duration of 120 days, we calculate the starting date by counting backward 120 days from 2 August 2021.

Using a date calculator:
- 2 August 2021 minus 120 days leads us to **4 April 2021** as the issue date.

### (b) The maturity value
The **maturity value** refers to the total amount payable at maturity, which includes the principal and the simple interest. The formula for simple interest is:

\[
I = P \times r \times t
\]

Where:
- \( P \) is the principal (RM 20,000),
- \( r \) is the annual interest rate (5% or 0.05),
- \( t \) is the time in years.

Since the note is for 120 days, we express \( t \) as a fraction of a year:

\[
t = \frac{120}{365}
\]

Now, let's calculate the interest and the maturity value:

\[
I = 20,000 \times 0.05 \times \frac{120}{365}
\]

\[
\text{Maturity value} = \text{Principal} + \text{Interest}
\]

### (c) The bank discount
Madam Wong discounted the note 60 days before maturity and received RM 20,400. The bank discount is the difference between the maturity value and the amount received from the bank.

\[
\text{Bank discount} = \text{Maturity value} - \text{Amount received (RM 20,400)}
\]

### (d) The bank discount rate
The bank discount rate can be found using the formula for the bank discount:

\[
\text{Bank discount rate} = \frac{\text{Bank discount}}{\text{Maturity value}} \times \frac{365}{60}
\]

This formula takes into account the time period over which the discount is applied (60 days).

I'll compute the answers for (b), (c), and (d) next.### Solutions:

1. **Date of the note:** 4 April 2021.
   
2. **Maturity value:** RM 20,328.77.

3. **Bank discount:** RM -71.23 (This negative value implies that the amount Madam Wong received was higher than the maturity value, which is unusual for typical discounting).

4. **Bank discount rate:** -2.13% (The negative value indicates that there is no discount in the typical sense; instead, Madam Wong gained from discounting the note).

It seems that the amount received (RM 20,400) exceeded the maturity value, which is an anomaly. This may suggest an error in interpretation or an unusual financial arrangement.

Would you like more details or further explanation on any part of the solution?

Here are 5 related questions you can explore:
1. How is the maturity value affected by a higher interest rate?
2. What would happen if the discount occurred 30 days before maturity instead of 60?
3. How is the time period in the interest formula calculated for non-standard years?
4. How do banks usually determine the discount rate?
5. What does a negative bank discount signify in real-life finance?

**Tip:** In finance, promissory notes are often discounted based on actual or 360-day years depending on the country. Be sure to check which convention applies!

Madam Wong received a 120-day promissory note for RM20,000 which matures on 2 August 2021 with a simple interest rate of 5% per annum. She later discounts the note 60 days before the maturity date and obtained RM20,400. Find the following: (a) The date of the note (b) The maturity value (c) The bank discount (d) The bank discount rate

Learn how to calculate the date, maturity value, bank discount, and discount rate for a 120-day promissory note valued at RM20,000, maturing on 2 August 2021 with 5% simple interest per annum. Understand key financial concepts like bank discounting and simple interest in this step-by-step breakdown.

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