Question

Oakwood Plowing Company purchased two new plows for the upcoming winter. In 200 days, Oakwood must make a single payment of $23,200 to pay for the plows. As of today, Oakwood has $22,500. If Oakwood puts the money in a bank today, what rate of interest will it need to pay off the plows in 200 days (assume 360 days)?

Answer 1

5.6%

Answer 2

Oakwood Plowing Company purchased two new plows for the upcoming winter. In 200 days, Oakwood must make a single payment of $22,950 to pay for the plows. As of today, Oakwood has $22,500. Assume the Oakwood puts the money in a bank today, what rate of interest will it need to pay off the plows in 200 days? (Use 360 days a year. Do not round intermediate calculations. Round your answer to the nearest tenth percent.)