Question
A payday loan company charges a $30 fee for a $550 payday loan that will be repaid in 15 days. Treating the fee as interest paid, what is the equivalent annual interest rate?
%interest Round to the nearest percent. This will be over 100%
%interest Round to the nearest percent. This will be over 100%
Answers
oobleck
treating it as simple interest at r%, that means
550(15 * (r/100)/365) = 30
r = 132.73%
check:
1.3273 * 15/365 * 550 = 30.00
550(15 * (r/100)/365) = 30
r = 132.73%
check:
1.3273 * 15/365 * 550 = 30.00