Question

In: Finance

Friendly's Quick Loans, Inc., offers you $7.50 today but you must repay $9.35 when you get your paycheck in one week (or else).

Friendly's Quick Loans, Inc., offers you $7.50 today but you must repay $9.35 when you get your paycheck in one week (or else).

Requirement 1:

If you were brave enough to ask, what APR would Friendly's say you were paying?

(Round answer as directed, but do not use rounded numbers in intermediate calculations. Enter your answer as a percent rounded to 2 decimal places (e.g.. 32.16).)

Annual percentage rate _________%

Solutions

Expert Solution

APR = week interest rate*number of weeks in a year

         = ((9.35/7.50)-1)*52

          = 1282.67%

 

APR = week interest rate*number of weeks in a year

         = ((9.35/7.50)-1)*52

          = 1282.67%

 

APR = week interest rate*number of weeks in a year

         = ((9.35/7.50)-1)*52

          = 1282.67%

Umair answered 2 years ago
Next > < Previous

Related Solutions

Calculating EAR. Friendly’s Quick Loans, Inc., offers you “three for four or I knock on your...
Calculating EAR. Friendly’s Quick Loans, Inc., offers you “three for four or I knock on your door.” This means you get $3 today and repay $4 when you get your paycheck in one week (or else). What’s the effective annual return Friendly’s earns on this lending business? If you were brave enough to ask, what APR would Friendly’s say you were paying? Valuing Perpetuities. Live Forever Life Insurance Co. is selling a perpetuity contract that pays $1,250 monthly. The contract...
upon graduating school you must repay $20,000 in student loans your interest rate is 6.8% how...
upon graduating school you must repay $20,000 in student loans your interest rate is 6.8% how much will your payment be if you make monthly payments over the standard 10 year payment term
A bookstore offers you the following deal: you pay $31 today (in January) and you get...
A bookstore offers you the following deal: you pay $31 today (in January) and you get 5% off the price of everything you purchase in December (for simplicity assume exactly 12 months from now). If your savings account earns 4.50% APR (compounded monthly), how much do you have to buy in December to just break even on the offer?
A bookstore offers you the following deal: you pay $33 today (in January) and you get...
A bookstore offers you the following deal: you pay $33 today (in January) and you get 8% off the price of everything you purchase in December (for simplicity assume exactly 12 months from now). If your savings account earns 3.08% APR (compounded monthly), how much do you have to buy in December to just break even on the offer?
Imagine next week when you get your midterm back instead of seeing your score at the...
Imagine next week when you get your midterm back instead of seeing your score at the top you see a z score. a. (2 point) What type of z-score would you want to see? Explain why. b. (2 point) What would a positive z-score mean? Explain. c. (2 point) What would a negative z-score mean? Explain. d. (2 point) What would a z-score of zero mean? Explain.
You wish to get a mortgage for $360,000.  Your mortgage lender offers you a choice of two...
You wish to get a mortgage for $360,000.  Your mortgage lender offers you a choice of two 15-year fixed-rate mortgages with monthly payments.  Neither mortgage has a pre-payment penalty.  Mortgage A has 0 points and the rate is 3.625%.  Mortgage Bhas 0.727 points and the rate is 3.375%.  You expect to pre-pay your mortgage after 5 years of payments.  Which mortgage, A or B, offers the higher expected yield to the lender?  
Your brother offers you $75,000 today for a claim to your future inheritance of $500,000, twenty...
Your brother offers you $75,000 today for a claim to your future inheritance of $500,000, twenty years from today. If the discount rate is 10%, should you accept his offer?
Design a one-week corrective exercise program for a friend or client. Your program must include the...
Design a one-week corrective exercise program for a friend or client. Your program must include the following: Have your client fill out the Lower Extremity Functional Index and the Upper Extremity Functional Index. Summarize what the results tell you about your client (you do not need to submit the filled out forms). Conduct an Upper Body Multi-Joint Movement Assessment and a Lower Body Multi-Joint Movement Assessment on your client. Summarize your findings and how these findings influenced your program design....
Design a one-week corrective exercise program for a friend or client. Your program must include the...
Design a one-week corrective exercise program for a friend or client. Your program must include the following: Have your client fill out the Lower Extremity Functional Index and the Upper Extremity Functional Index. Summarize what the results tell you about your client (you do not need to submit the filled out forms). Conduct an Upper Body Multi-Joint Movement Assessment and a Lower Body Multi-Joint Movement Assessment on your client. Summarize your findings and how these findings influenced your program design....
You borrow $7,000 today and promise to repay the loan over the next three years with 36 equal, end-of-month payments starting one month from today.
You borrow $7,000 today and promise to repay the loan over the next three years with 36 equal, end-of-month payments starting one month from today. The interest rate is 4% APR compounded monthly. What is the amount of each payment? Round only your final answer to two decimal places.• $206.67• $194.44• $214.98• $202.19• $223.86
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT