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katovenus [111]
3 years ago
11

A car loan company states. "You only pay $.31 a day for each $500.00 borrowed." If you borrow $1,431 for 151 days, what amount w

ill you repay. and what annual interest rate is the company actually charging" (Assume a 360-day year)
Mathematics
1 answer:
Levart [38]3 years ago
7 0

The amount you will repay can be solved by:

Amount to be repaid = ( $ 1, 431 borrowed) ( $ 0.31 per day / $ 500 borrowed) 151 days

Amount to be repaid = $ 133.97

The annual interest rate is:

1431 + 133.97 = 1431( 1 + i)^ 151(1/360)

Solve for i

i = 0.2378 or 23.78 % per year 

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