Life-leech payday lenders offers 7-day loans at 348% APRcompounded daily. Furthermore, if you wish to roll-over yourdebt, without repayment, you may do so paying an additional14% effective weekly rate (EWR). This amount would be ontop of the agreed loan rate. If you were to borrow $6321.11and held it for 18 months, without ever paying the principal,what would be your balance owing?You may assume 365 days and 52 weeks in a year. Pleasegive your answer in dollars, eg 10000 for an outstanding loanbalance of $10,000Answer:

To calculate the owed balance after 18 months, we need to calculate the compound interest that would…

Answered: top of the agreed loan rate. If you…

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter19: Lease And Intermediate-term Financing

Section: Chapter Questions

Problem 19P

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top of the agreed loan rate. If you were to borrow $6321.11 and held it for 18 months, without ever paying the principal, what would be your balance owing?