Question

Mike Drago took out a loan for $3,800 at the Gold Coast Bank for 280 days. If the bank uses the ordinary interest method, what rate of interest was charged if the amount of interest was $278? Round your answer to the nearest tenth of a percent.

Answer 1

well, the amount of interest per day was 278/280

So, the percent interest per day was (278/280)/3800 = .0002613 = 0.02613%

Now multiply that by how many days in a year ...