Question

Payday loans are very short-term loans that charge very high interest rates. You can borrow $400...

Payday loans are very short-term loans that charge very high interest rates. You can borrow $400 today and repay $484 in two weeks.

What is the compounded annual rate implied by this 21 percent rate charged for only two weeks? (Hint: Compound the 2-week return 26 times for the annual return.)

HOW DO I SOLVE IN EXCEL

Business   Finance   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

SEE THE IMAGE. ANY DOUBTS, FEEL FREE TO ASK. THUMBS UP PLEASE

THERE ARE 2 WAYS TO SOLVE. I FEEL FIRST CONVERT IT IN APR AND THEN EAR.

OR AS YOU SAID 26 TIMES COMPOUNDING 2 WEEK RATE.

I HAVE SHOWN BOTH TH WAYS

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Sarcosuchus Corporation offers very short-term loans to applicants with low credit ratings. They charge an interest...
Sarcosuchus Corporation offers very short-term loans to applicants with low credit ratings. They charge an interest rate of 0.03333 percent per hour. a. If you borrow $100 from Sarcosuchus, how much will you owe in one week? b. If you borrow $100 from Sarcosuchus, how much will you owe in one month (30 days)? c. What annual rate is Sarcosuchus charging? Hint: Convert the simple hourly rate of 0.03333 percent into simple annual rate. Treasury bills are short-term government bonds,...
Your local loan shark offers weekly payday loans: You can borrow $1,000 and pay back $1,040...
Your local loan shark offers weekly payday loans: You can borrow $1,000 and pay back $1,040 one week later (or lose a finger or two). 1. What is the effective annual rate on the loan? Enter your answer as a decimal and not a percentage. 2. What is the APR on the loan? Enter your answer as a decimal and not a percentage.
  The following balance sheet and income statement should be used for questions #1 through #6: Kuipers,...
  The following balance sheet and income statement should be used for questions #1 through #6: Kuipers, Inc. 2001 Income Statement (OMR in millions) Net sales 9,625 Less: Cost of goods sold 5,225 Less: Depreciation 1,890 Earnings before interest and taxes 2,510 Less: Interest paid 850 Taxable income 1,660 Less: Taxes 581 Net income 1,079 Addition to retained earnings 679 Dividends paid 400 Kuipers, Inc. 12/31/00 and 12/31/01 Balance Sheet (in OMR, in millions) 2000 2001 2000 2001 Cash 1,455 260...
Discuss ethical issues that can be identified in this case and the mode of managing ethics...
Discuss ethical issues that can be identified in this case and the mode of managing ethics Enron finds itself in this case. How would you describe the ethical culture and levels of trust at Enron? Provide reasons for your assessment. THE FALL OF ENRON: A STAKEHOLDER FAILURE Once upon a time, there was a gleaming headquarters office tower in Houston, with a giant tilted "£"' in front, slowly revolving in the Texas sun. The Enron Corporation, which once ranked among...
Please read the article and answear about questions. Determining the Value of the Business After you...
Please read the article and answear about questions. Determining the Value of the Business After you have completed a thorough and exacting investigation, you need to analyze all the infor- mation you have gathered. This is the time to consult with your business, financial, and legal advis- ers to arrive at an estimate of the value of the business. Outside advisers are impartial and are more likely to see the bad things about the business than are you. You should...
What role could the governance of ethics have played if it had been in existence in...
What role could the governance of ethics have played if it had been in existence in the organization? Assess the leadership of Enron from an ethical perspective. THE FALL OF ENRON: A STAKEHOLDER FAILURE Once upon a time, there was a gleaming headquarters office tower in Houston, with a giant tilted "£"' in front, slowly revolving in the Texas sun. The Enron Corporation, which once ranked among the top Fortune 500 companies, collapsed in 2001 under a mountain of debt...
Discuss how the respective organizations’ relations with stakeholders could have potentially been affected by the events...
Discuss how the respective organizations’ relations with stakeholders could have potentially been affected by the events that took place at Enron and how the situation could have been dealt with differently to prevent further damage? THE FALL OF ENRON: A STAKEHOLDER FAILURE Once upon a time, there was a gleaming headquarters office tower in Houston, with a giant tilted "£"' in front, slowly revolving in the Texas sun. The Enron Corporation, which once ranked among the top Fortune 500 companies,...
Delta airlines case study Global strategy. Describe the current global strategy and provide evidence about how...
Delta airlines case study Global strategy. Describe the current global strategy and provide evidence about how the firms resources incompetencies support the given pressures regarding costs and local responsiveness. Describe entry modes have they usually used, and whether they are appropriate for the given strategy. Any key issues in their global strategy? casestudy: Atlanta, June 17, 2014. Sea of Delta employees and their families swarmed between food trucks, amusement park booths, and entertainment venues that were scattered throughout what would...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT