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anonymous

  • one year ago

will fan and medal! Can somebody help me solve this with an explanation please!! What is the APR of a payday loan for $1100 due in 5 days that charges a $165 fee?

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  1. anonymous
    • one year ago
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    @perl

  2. perl
    • one year ago
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    the borrower receives $1100 today, and must pay $1265 in 5 days

  3. perl
    • one year ago
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    how many 5 day periods are in a 365 day year?

  4. perl
    • one year ago
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    its a little more involved

  5. anonymous
    • one year ago
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    so 73?

  6. perl
    • one year ago
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    365/5 = 73 periods of 5 days in a year. 73 * $165 = $12,045 total interest in a year (if he kept that rate in 5 days)

  7. anonymous
    • one year ago
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    but then how would we find the percentage?

  8. perl
    • one year ago
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    12,045 / 1100 = 10.95 = 10.95 * 100 %

  9. perl
    • one year ago
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    1095% APR

  10. anonymous
    • one year ago
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    thank you so much i will refer to this every time i come across a question like this!!

  11. anonymous
    • one year ago
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    life saver like for reals!

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