Question

Fred ran short on cash and borrowed​ $300 through a payday loan company. the company charged him a fee of​ $60 to borrow the​ $300 for 14 days. using the simple interest method calculate what interest rate was fred charged for the aforementioned loan.

Answer 1

The answer is 1.43 % per day. Calculations: Formula for simple interest: I=PRT, where I=interest; P= borrowed amount; R=rate of interest in percentage; T=time for repayment hence; P=$300, I=$60, T=14 days, then R=? R={(I/PT) *100)}% per day={(60/300*14)*100}=1.43 % per day interest rate (R) that Fred was charged for the aforementioned loan was 1.43 % per day