I = PRT
25 = 600 * R * 0.667
25 / 400.2R
25/400.2 = R
R = 0.06247 = 6.25%
You buy some furniture for $600. The department store offers you “no interest for 8 months” after which you can pay the $600 in one lump sum. To take advantage of this deal, the store charges a $25 service fee, which is to be paid today. What rate of simple interest is the store charging you for this “no interest” loan?
I am completely lost with this question.
This is what I have tried but I'm pretty sure it is wrong.
FV=PV(1+r)^n
600=600 (1+r)^(0.67)
r= 0.04166
1 answer
1 answer