A payday loan is structured to obscure the true interest rate you are paying. For example, in Washington, you pay a $30 "fee" for a two-week $200 payday loan (when you repay the loan, you pay $230). What is the effective annual interest rate for this loan? (Assume 26 bi-weekly periods per year.) The effective annual interest rate is ______%.
A payday loan is structured to obscure the true interest rate you are paying. For example, in Washington, you pay a $30 "fee" for a two-week $200 payday loan (when you repay the loan, you pay $230). What is the effective annual interest rate for this loan? (Assume 26 bi-weekly periods per year.) The effective annual interest rate is ______%.
Chapter16: Working Capital Policy And Short-term Financing
Section: Chapter Questions
Problem 14P
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A payday loan is structured to obscure the true interest rate you are paying. For example, in Washington, you pay a $30 "fee" for a two-week $200 payday loan (when you repay the loan, you pay $230). What is the effective annual interest rate for this loan? (Assume 26 bi-weekly periods per year.)
The effective annual interest rate is ______%. (Round to two decimal places.)
![A payday loan is structured to obscure the true interest rate you are paying. For example, in Washington, you pay a $30 "fee" for a two-week $200 payday loan
(when you repay the loan, you pay $230). What is the effective annual interest rate for this loan? (Assume 26 bi-weekly periods per year.)
The effective annual interest rate is %. (Round to two decimal places.)](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F6f622088-e5ba-4c84-b044-5e4b68af7b7e%2Fc0e433b4-2e73-4280-a7b7-bdb98b3a41d6%2Fhbsryds_processed.jpeg&w=3840&q=75)
Transcribed Image Text:A payday loan is structured to obscure the true interest rate you are paying. For example, in Washington, you pay a $30 "fee" for a two-week $200 payday loan
(when you repay the loan, you pay $230). What is the effective annual interest rate for this loan? (Assume 26 bi-weekly periods per year.)
The effective annual interest rate is %. (Round to two decimal places.)
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