Band books

Before I made this loan I was
getting five per cent on the money. I must now look to the farm for my
five per cent. If it cannot pay this interest promptly, I shall add the
deferred payment to the principal, and it shall bear interest. This must
be done each year until the net income from the farm is greater than the
interest account. Whatever is over will then be used to reduce the
principal."
"That's a long speech, but I don't think it's very clear. I don't see
why a man should pay interest on his own money. The farm is yours, isn't
it? You bought it with your own money, didn't you? What difference does
it make whether you charge interest or not?"
"Not the least difference in the world to us, Polly, but a great deal to
the experiment."
"Oh, yes, I forgot the experiment. And how much interest do you add?"
"Five hundred and forty-two dollars. Also, $75 to the lawyer and $5 for
recording the deed, making the whole debt of the farm to me $44,000
even."
"Does it come out just even $44,000? I believe you've manipulated the
figures.


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