Essentials Of Investments
11th Edition
ISBN: 9781260013924
Author: Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher: Mcgraw-hill Education,
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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.)
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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