Essentials Of Investments
Essentials Of Investments
11th Edition
ISBN: 9781260013924
Author: Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher: Mcgraw-hill Education,
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Homework 5: Chapter VI i
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Problem 6-22 Calculating EAR [LO4]
Friendly's Quick Loans, Inc., offers you "$4.30 for $5.30 or I knock on your door." This
means you get $4.30 today and repay $5.30 when you get your paycheck in one week
(or else).
8.33
points
Skipped
a. If you were brave enough to ask, what APR would Friendly's say you were paying?
(Do not round intermediate calculations and enter your answer as a percent
rounded to 2 decimal places, e.g., 32.16.)
b. What's the effective annual return Friendly's earns on this lending business? (Do not
round intermediate calculations and enter your answer as a percent rounded to 2
decimal places, e.g., 32.16.)
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Transcribed Image Text:Homework 5: Chapter VI i Saved Help Save & Exit Submit Check my work 11 Problem 6-22 Calculating EAR [LO4] Friendly's Quick Loans, Inc., offers you "$4.30 for $5.30 or I knock on your door." This means you get $4.30 today and repay $5.30 when you get your paycheck in one week (or else). 8.33 points Skipped a. If you were brave enough to ask, what APR would Friendly's say you were paying? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) b. What's the effective annual return Friendly's earns on this lending business? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) еВook Ask Print References la. APR % b. EAR % Mc Graw Hill < Prev 11 of 12 Next > Education
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