Payday loans are very short-term loans that charge very high interest rates. You can borrow $300 today and repay $360 in two weeks What is the compounded annual rate implied by this 20 percent rate charged for only two weeks? (Hint: Compound the 2-week return 26 times for the annual return.) Note: Do not round intermediate calculations and round your final answer to the nearest whole percent. Compounded annual rate
Payday loans are very short-term loans that charge very high interest rates. You can borrow $300 today and repay $360 in two weeks What is the compounded annual rate implied by this 20 percent rate charged for only two weeks? (Hint: Compound the 2-week return 26 times for the annual return.) Note: Do not round intermediate calculations and round your final answer to the nearest whole percent. Compounded annual rate
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Transcribed Image Text:Payday loans are very short-term loans that charge very high interest rates. You can borrow $300 today and repay $360 in two weeks.
What is the compounded annual rate implied by this 20 percent rate charged for only two weeks? (Hint: Compound the 2-week return
26 times for the annual return.)
Note: Do not round intermediate calculations and round your final answer to the nearest whole percent.
Compounded annual rate
%
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