BUSN 5200 F2 2022: Compound Frequency Payday loans are very short-term loans that charge very high interest rates. You can borrow $500 today and repay $550 in two weeks. What is the compound annual rate implied by this 10 percent rate charged for only two weeks?
Posted: December 23rd, 2022
Compound Frequency Payday loans are very short-term loans that charge very high interest rates. You can borrow $500 today and repay $550 in two weeks. What is the compound annual rate implied by this 10 percent rate charged for only two weeks?
110.50 percent
1091.78 percent
(1 + 0.10)^26 – 1 = 1091.78 percent
10.50 percent
12.00 percent
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