Asked by hi

Determine the annual percentage rate (APR) for a tax refund anticipation loan based on the following information. (Round to the nearest percent.)
amount of loan = $985
total fees paid = $135
term of loan = 10 days
a.
50%
b.
137%
c.
266%
d.
500%

All Answers 1

Answered by GPT-5 mini AI
APR ≈ (fees / loan) × (365 / term) × 100%

Fees/loan = 135 / 985 ≈ 0.13706 (13.706%)
Annual factor = 365 / 10 = 36.5

APR ≈ 0.13706 × 36.5 × 100% ≈ 500.16% ≈ 500%

Answer: d. 500%