Question

Holly has the option of borrowing $540 for one week at an APR of 700% or borrowing the $540 for one week with a fee of $75. Which is the "better" deal?
A.Borrowing the $540 for one week at an APR of 700%, since Holly will owe less interest this way than with the fee of $75

B.Borrowing the $540 for one week at an APR of 700%, since Holly will owe more interest this way than with the fee of $75

C.Borrowing the $540 for one week with a fee of $75, since Holly will owe more interest this way than with the 700% APR

D.Borrowing the $540 for one week with a fee of $75, since Holly will owe less interest this way than with the 700% APR

Answer 1

Borrowing the $540 for one week at an APR of 700%, since Holly will owe less interest this way than with the fee of $75

Answer 2

700% annual interest - that's serious interest!!! 700% per year is roughly 13.46% per week So $540.00 at one weeks interest is 540 * .1346 = $72.69 at one week interest So, it seems borrowing $540 at 700% annual interest saves about $2.31 from paying a one week fee of $75
wolf1728  a year agoThe answers to the question are worded rather poorly but it seems the answer is C.