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
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
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