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). 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.) a. APR % b. EAR %
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). 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.) a. APR % b. EAR %
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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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
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la.
APR
%
b.
EAR
%
Mc
Graw
Hill
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Transcribed Image Text:Homework 5: Chapter VI i
Saved
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Save & Exit
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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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